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A leading hedge fund built a stake in GameStop from scratch last quarter, before the meme stock's surge.
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Renaissance Technologies' 1 million shares were briefly worth $65 million at Tuesday's high.
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RenTech, founded by the late Jim Simons, also upped its bet on AMC and undercut Tesla and Nvidia.
A world famous hedge fund revealed it built a stake in GameStop from scratch last quarter, making it a potential winner among meme stocks. explosive jump this week.
Renaissance Technologies held 1 million shares of the video game retailer at the end of March, a position worth $13 million at the time, according to its first quarter portfolio update watch.
GameStop stock rose more than 400% at its Tuesday high, briefly valuing RenTech's stake at $65 million if it's still intact. The stock price fell from that high of nearly $65 to around $33 on Wednesday, still leaving the company worth more than $10 billion.
THE GameStop stock rally was fueled by the return of Keith “Roaring Kitty” Gill to social media this week. The retail investor was one of biggest winners of the social media frenzy that sent GameStop soaring in early 2021.
RenTech uses algorithms to decide many of its trades, which can result in drastic changes to its stock portfolio each quarter. It was founded by Jim Simonsthe famed Cold War-era math professor and code breaker who died Friday.
The quant fund made other striking changes to its holdings last quarter.
He cut his Nvidia stake by almost two-thirds, from about 1.5 million shares to 551,000, reducing the value of the position from about $767 million to less than $500 million.
RenTech has reduced its You're here stake as well, going from 2.6 million shares worth $635 million to 1.8 million shares worth $316 million. It also accumulated in AMC Entertainment Holdings – another notable meme stock – ups its bet on the movie chain, going from 4.9 million shares worth about $30 million in December to 8.7 million shares in March, which were valued at $60 million at close Tuesday.
The total value of the company's stock portfolio remained almost flat at around $64 billion. Its top three holdings were Novo Nordisk, Palantir and Meta at the end of March. Uber and Nvidia occupied second and third positions three months earlier.
It's worth emphasizing that quarterly portfolio updates only provide a snapshot of a company's holdings on a particular date and exclude short-sold stocks, private investments and overseas bets.
They don't always paint a complete picture of the investment strategy behind choices, especially when algorithms dictate trades.
Read the original article on Business Insider