Icahn Bets Against GameStop

Icahn Bets Against GameStop

Carl Icahn, the founder of Icahn Enterprises and a billionaire investor, continues to hold a large position in GameStop Corp., nearly two years after he started building a short against them when GameStop was trading at $483 per share amidst the meme-stock craze of January 2021. Since then, he has added to his position, reports an article in Bloomberg, though the size of that stake is unknown.

GameStop’s stock climbed 2.3% recently, but has lost 71% of its value since that January 2021 high. Driven by no-fee trading apps and armchair investors flush with stimulus cash and advice from online forums such as Reddit, GameStop became the face of meme stocks. Many investors who shorted GameStop got squeezed out, including Melvin Capital which announced its folding earlier this year due to the heavy losses it incurred by betting against the video-game retailer, the article details.

Icahn isn’t known for betting against meme stocks, but over one-fifth of GameStop’s shares that are up for trading are being shorted, according to data from S3 Partners that’s cited in the article. That’s a far cry from January 2021 when it hit a peak of over 140%, but the craze allowed GameStop to offload much of its debt by selling millions of shares in the open market. And though Reddit and other online forums were largely the fuel for the meme-stock frenzy last year, they remained relatively mum on Icahn’s bet and the stock wasn’t trending across social media platforms in the wake of the news.

Representatives for both GameStop and Icahn declined to comment to Bloomberg, who spoke to an anonymous source about the matter.


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