Melvin capital went bankrupt because of GameStop, and then the other hedge funds pulled strings to minimize their losses. We’re talking about institutions. How many of the short sellers didn’t have the buying power to cover their shorts?
Melvin Capital received a $2.5 billion infusion of cash. They haven't gone bankrupt. They're down 30% for the year.
When a stock has a 140% short interest - that is 14 shares of stock sold short for every 10 shares of float - then many short sellers don't have the buying power to cover. That's why I have no sympathy for them. They're stupid.
I thought they went bankrupt. If I’m wrong about that I own it. I know they took a large haircut on selling GameStop short and closed their position. Dude Short selling GameStop was as obvious a play as shorting Barnes and nobles. No one thought retail investors would band together and spoil the party. I firmly believe these institutions got what they’ve been dishing out forever, and they had to change the rules to minimize the damage