AMC Entertainment Holdings, Inc. has blown up another prominent hedge fund to close out 2021:
The New York-based hedge fund Anchorage Capital Group has shut down after more than 18 years of capital management.
Anchorage Capital had 4 million put options on AMC, which accounted for 17.8% of its portfolio.
Anchorage Capital Group had the second-largest short position against AMC stock.
The hedge fund’s founder, Kevin Ulrich, has a sordid past. From Bloomberg:
Last year, a woman sued Ulrich, accusing him of sexual battery in a Manhattan hotel in 2019 — a complaint that was later withdrawn. Institutional Investor, citing an Anchorage client, reported in November 2020 that Ulrich settled with the accuser and that clients were displeased by the firm’s failure to disclose the allegations after they became a matter of public record.
Perhaps Ulrich was a little too busy with the rape allegations to mind his portfolio.
Anchorage compounded their misfortune with massive put option bets on other meme stocks like GameStop Corp. and Bed Bath & Beyond, Inc. The $7.4 billion fund will now be liquidated.
Anchorage’s returns had been lackluster for years, and its assets under management had shrunk by half from their peak. Indeed, Bloomberg reports it had been “trying to shrink.”
I’m sure AMC shareholders were happy to give them some help with that.
There will be no blog tomorrow. See you on Monday and happy new year!
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