A Wall Street titan linked to Robinhood’s remarkable feeding frenzy abruptly dropped Twitter on Friday night because it turned out that some board members of the companies involved cashed in on the surreal week.
Steve Cohen, the financier and owner of the New York Mets, worth about $ 14.6 billion, worshiped on Twitter on Friday.
Cohen’s Point72 Asset Management, a $ 19 billion hedge fund he founded in 2018, was caught in the act this week through their relationship with Melvin Capital, a hedge fund that bet heavily on GameStop.
Point72 already had about $ 1 billion under management, and Melvin added $ 750 million to stabilize Melvin this week, when the price of GameStop shares rose, causing massive losses for Melvin.
Steve Cohen, a roughly $ 14.6 billion financier, has been captured in the GameStop saga
Cohen had discussed the trades of the week with Dave Portnoy, the founder of Barstool Sports
GameStop shares rose 135% on Wednesday alone and rose more than 1,700% this year, after a Reddit forum, WallStreetBets, began forcing the price largely through the Robinhood trading platform.
The increase affected some large investors, such as Melvin, who bet against the stock.
Cohen, who bought the New York Mets in November, taking Jennifer Lopez and Alex Rodriguez away to form the baseball team, earlier this week seemed to enjoy a solid debate about mountain markets.
“Tough crowds on Twitter tonight,” Cohen wrote on Twitter on Wednesday night. “Hey, stock jockeys keep bringing them.”
On Thursday, Cohen entered a Twitter debate with trader Dave Portnoy, after Barstool Sports blogger attacked Cohen for restrictions on trading apps like Robinhood, which hurt start-up investors leading to an increase in the value of the GameStop stock.
“Hey Dave, that’s your beef for me,” Cohen tweeted. “I’m just trying to make a living just like you.” Glad to download this offline. ‘
Finally, Portnoy posted on Twitter: “At least you talk and try to answer. That is appreciated.
By Friday night, Cohen’s account had been deleted.
Many lamented his departure from Twitter, after enjoying his unusual interaction with Mets fans and unfiltered opinions.
“Give this to Steve Cohen, he didn’t announce very much that he needs a ‘break in social networks’ before disconnecting,” Laura Albanese, a sports reporter at Newsday, wrote on Twitter.
Others took a more comical side, with a single tweeting: “It’s nice to see Steve Cohen honoring the Mets tradition of giving up after a few months.”
Traders, photographed on the New York Stock Exchange on January 9, had a wild week
Cohen’s inclination on social media came when it emerged that others involved in the extraordinary week had taken enormous advantage of the situation.
As of January 1, BlackBerry and GameStop executives have been selling shares for a total of more than $ 22 million.
The executives also received a massive boost from the amateur traders on the social networks who auctioned the shares of the companies.
Some have stated their mission is to redirect Wall Street profits to ordinary people, but in doing so, they have inadvertently helped the company’s executives.
Steve Rai, chief financial officer of Blackberry (left) and Kurt Wolf, board member of GameStop, have benefited both from the increase in their companies’ stocks
Robinhood broker has been the focus of growing GameStop stocks
Protesters gathered outside the New York Stock Exchange on Thursday night
Three BlackBerry executives received nearly $ 1.7 million worth of shares last week, CBS News reported.
One of the three, BlackBerry Chief Financial Officer Steve Rai, has sold all his shares in the company, although he has uninvested options that could turn into shares in the future.
BlackBerry shares were trading at about $ 5.50 until the Reddit board took over, which means the trio’s shares would be worth about $ 700,000.
But the frenzy added $ 1 million to the combined value of their shares.
It was unclear how much of the $ 1.7 million went to Heaven.
At GameStop, money manager and former executive consultant Kurt Wolf, who joined GameStop board last year, sold more than two-thirds of its shares in January.
The sale raised Wolf’s investment fund by just over $ 17 million.
There are no charges of improper inside trading of any trades.
Developments with financiers came as Robinhood continued to restrict trading for small investors.
On Thursday, Robinhood blocked the sale of certain shares and sold the shares to users without permission – provoking online riots, protests on Wall Street and launching investigations by Congress and the New York Attorney General.
Robinhood CEO Vlad Tenev, 33, defended the company’s shares on Thursday night.
Vlad Tenev defended his company’s actions in an interview on Thursday night
‘We had to make a very difficult decision. It was a difficult day, “Tenev told MSNBC.
Robinhood cited “recent volatility” for the decision to prevent users from buying shares in GameStop and 12 other companies that Reddit users selected for “short spills.”
The company had to consolidate its cash cushion in order to do business. With the additional cash infusion, Robinhood said it would lift restrictions on certain stocks, which were limited on Thursday.
However, on Friday, Robinhood users were still limited.
At the end of the day, customers were able to buy a single share of GameStop, after being able to buy five at the beginning of trading.
The stock exchange application also expanded its list of restricted shares from 13 May earlier that day to 50.
A “short squeeze” happens when investors target a stock – in this case, GameStop, which has a high “short interest”.
It is short when an investor essentially places a bet that a share will fall. If it falls, the investor makes money. But a squeeze happens when another investor bets that the stock will grow. If enough investors do this, the stock price rises and squeezes the short – causing the investor who bet that the stock would fall to lose money.
The company was hit by a class action lawsuit accusing it of agreeing to Wall Street by blocking investors’ ability to buy shares.