Melvin Capital started 2021 with $12.5 billion in assets before retail investors from Reddit caused the house to lose billions on its GameStop brusk positions.

According to a Wall Street Periodical report, the hedge fund has a little more $8 billion in assets at the end of January, which includes a $two.75 billion investment from Citadel and Point72 Asset Management before this month. This represents a 53% loss, co-ordinate to people familiar with the firm.

In the report, a client claims that Melvin has "massively de-risked" its investment portfolio following the controversy involving short selling GameStop stocks. People familiar with the hedge fund said Melvin has restructured its portfolio to ameliorate its ability to exit securities easily. The hedge firm, also as Citron Capital — another firm involved in the shorts — reportedly closed out their positions with GameStop last week.

Many of the major players involved in the GameStop brusque squeeze are facing outrage online after Robinhood — a platform with fiscal ties to Melvin — and other investment tools restricted trading for GameStop stock in the middle of a price surge. Retail investors seemingly being cut off from financial tools afforded to major hedge funds prompted allegations of market manipulation.

The U.Due south. Securities and Commutation Commission appear on Friday that it would be "closely [reviewing] actions taken by regulated entities," purportedly in connectedness to the situation surrounding Citadel, Melvin, Robinhood, and potentially the retail investors from the r/WallStreetBets subreddit. In addition, Robinhood is facing ii class-activity lawsuits in federal courts in Illinois and New York.

The price of GameStop stock was $325 when markets airtight on Friday, having risen 67% in the previous 24 hours.