Evan Agostini / AP
- According to Fidelity Investments, Fidelity Investments sold a total of 87 shares of its GameStop shares in January.
- Fidelity was once the largest shareholder in the video game retailers that own 13% of the company.
- The company was not the only institutional investor that could shell out the shares as the price rose.
- Senvest Management also made nearly $ 700 million in profits, the Wall Street Journal reported.
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Fidelity Investments acquired its GameStop shares amid the meteoric rise in the stock in January. The company sold all but 87 shares, according to documents released Jan. 29.
Fidelity was the largest shareholder in GameStop on December 31 and owned 9.3 million shares, or 13% of the company, on December 31.
Shares of the video game retailer began in January, after the company became the target of traders on Reddit’s WallStreetBets forum to launch a brief push on shares.
What started as a way for a group of traders to make a profit quickly turned into a full-fledged populist movement that saw retailers on Reddit oppose short-term hedge funds such as Melvin Capital.
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For some time now, the Redditors have had institutional investors on the collar as the GameStop share jumped more than 1,900%, from early January prices to a closing price of more than $ 340 per share on January 27th.
Then brokers started buying the popular stocks, and since then retailers have been pulling back. GameStop shares traded at about $ 50 a share on Thursday.
It’s not just retailers who are benefiting from the rise of GameStop. Institutional funds such as Senvest Management also seized the action, making nearly $ 700 million in profits.
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Almost all of Fidelity’s shares were in two mutual funds, the Fidelity Low-Price Stock Fund and the Fidelity Series Intrinsic Opportunities Fund, both managed by Joel Tillinghast.
However, these positions do not take into account the ownership of Fidelity’s sister company, Geode Capital, which manages all of Fidelity’s equity index investments.
Before the GameStop saga last year, Tillinghast shared his argument about owning smaller retail businesses.
‘If there is a vaccine for Covid-19, and smaller investment companies, such as retailers and clothing companies, successfully move to an optimal business model of both e-commerce and brick stores, it is possible that much smaller will be undervalued. “capitalization companies are showing extraordinary earnings growth,” Tillinghast said according to WSJ.
Although Tillinghast’s theories did not come true, his funds were still able to profit from their GameStop investments.
GameStop is trading 3.81% at $ 49.25 as of Thursday 13:38 EST.