Citadel LLC added tens of millions of dollars to its option bet on AMC Entertainment Holdings, Inc. in the most recent quarter.
Its net bullish position increased from $90 million to $125 million, according to an SEC report released yesterday. It also built a bullish position in GameStop Corp. options during the period.
The hedge fund giant held $245 million in call options and $120 million in puts, versus $191 million and $101 million respectively in February.
Never miss a post…subscribe!
This bullish position is ironic given that Citadel was a major backer of Melvin Capital Management LP. Melvin lost billions shorting AMC, Gamestop Corp., and other meme stocks last year, and may have imploded had Citadel not rescued them.
Perhaps Citadel’s patience with Melvin’s investing style has run out. Citadel has pulled out most of its $2 billion investment in the failing firm, and began adding to its AMC options position around the same time.
The SEC report doesn’t specify the strike prices or duration of the options, so we don’t know exactly what Citadel’s strategy is. It could be expecting lower prices in the short term and higher ones in the long term, or vice versa.
But I find it fascinating that this archvillain of the meme stock saga has capitulated and placed bullish bets on the same companies. It seems Citadel’s losses in Melvin’s hedge fund taught it a lesson.
What do you think Citadel’s strategy is? Leave a comment at the bottom and let me know!
More on markets:
Hedge Fund Giant Tiger Global Losing $28 Million an Hour
Melvin Capital Faces Investor Revolt
Hedge Funds Could Lose Nearly Half of Assets Under Proposed SEC Rule
Never miss a post…subscribe!
Photo: Citadel LLC CEO Kenneth Griffin
If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog!
Save Money on Stuff I Use:
This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.
More on Fundrise in this post.
If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!
I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!
I wrote a detailed review of Misfits here.
Use this link to sign up and you’ll save $15 on your first order.
Tremendous 
If you don’t know what’s gonna happen in June to meme stocks. Then you are not as smart as the ape army. Stop watching the news for stock picks. Nobody mentioning amc and they tell you to stay away. I wonder why? They tell you to buy blue chips while they get hammered when you should be buying under valued growth stocks at all time low
LikeLike