Michael Jordan caught in Wall Street maelstrom after Hornets investors suffer losses

NBA legend Michael Jordan is not one to play with stocks but found himself in the mix of the Wall Street chaos. Hedge fund titans have suffered massive losses amidst their war with Redditors, with reports suggesting that the Reddit attack on Wall Street has caused more than $5 billion in losses from established hedge funds. At the centre of it is Melvin Capital, who along with Daniel Sundheim, purchased a stake in Jordan's Charlotte owners. 

Also Read: Mark Cuban's 11-year-old Son Jake Invests In AMC, Blackberry Amid Reddit's Stock Driving

What's happening at stock market? Michael Jordan's fellow Hornets owners suffer massive losses 

Michael Jordan picked a poor time to welcome new investors into his majority ownership of NBA franchise the Charlotte Hornets with business partners Gabe Plotkin and Daniel Sundheim reportedly suffering massive losses due to the Reddit attack on Wall Street. The Hornets owners pursued an aggressive short-selling strategy before being caught in the act by individual investors, who combined forces to drive up GameStop’s share price more than 1700 per cent. Melvin Capital had bet against GameStop by short-selling its shares and were in line for profits if the price went down and losses if it went up.

Also Read: Miami Heat To Use COVID-19-sniffing Dogs As Fans Return To American Airlines Arena

However, members of the Reddit group WallStreetBets put the “short squeeze” on hedge funds, which saw them squander more than $5 billion. Melvin Capital accepted defeated yesterday, with boss Plotkin admitting to CNBC that the fund had closed its position in GameStop on Tuesday, suffering huge losses. Reports suggest that Melvin Capital required a huge bailout to stay afloat. According to reports, the extreme losses experienced by Plotkin and Sundheim have dire consequences for Jordan and his future business options.

Also Read: NBA Fan Ejected From Lakers Game For Holding Up ‘LeBron Is A Racist, Narcissist’ Shirts

Reports suggested that both Plotkin and Sundheim were interested in purchasing more stake at the Hornets, with the 57-year-old reported to have lost up to $300 million in his net worth in the past 12 months. The duo had been rumoured to purchase the franchise outright, but all those plans seem to be off now. Industry speculation suggests that the massive losses could in fact force them to sell some of their stakes in the Charlotte Hornets to remain afloat. Melvin Capital were helped by New York Mets owner Steve Cohen’s hedge fund, Point72 Asset Management, who invested $750 million in the hedge fund alongside a $2 billion investment from Citadel. 

Also Read: Bradley Beal Trade: Lakers, Clippers Interested In Wizards Star As Rumours Gain Traction

(Image Courtesy: AP)