Hedge fund Senvest posts 85% return in 2021 riding GameStop meme, among Wall Street's best

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A famous saying in the market is “As January goes, so goes year”. It’s the same for last year’s January market mania as it is about some 2021 hedge funds returns.

In a year in which the market has raised many funds more, GameStopDespite this, the numbers of some funds involved in the trade still had a significant impact.

Senvest Management – which famously made “one of the great fortunes of the January market mania,” as the Wall Street Journal described it, by being long GameStop ahead of the frenzy – generated full-year returns of 85 percent, according to an investor familiar with the numbers.

According to figures tallied HSBC by HSBC Senvest held the title of the most-performing hedge funds in November with $3.2 Billion assets. It’s possible that Senvest’s year-over-year performance helped them maintain this standing.

Another side to the GameStop deal

It was harder for those on the opposing side of GameStop to recover. Melvin Capital was the target of anger from retail traders because of a publically disclosed position in the video-game retailer. According to one person who knows the facts, Melvin Capital posted losses of 39 per cent for 2021.

Melvin’s outlook was positive after January. The person stated that Melvin had returned 33 percent between February 1 and December 31. It ended the year with assets of $11.7 billion.

This story about two hedge funds demonstrates the lasting impact volatility had on GameStop in the first months of 2021, and the contribution it made to institutional investors’ gains and losses throughout the year.

Citadel led by Ken Griffin was joined by Steve Cohen’s Point72 to make a $2.75billion cash infusion in order to stabilize Melvin during this time of tightening. Citadel was eventually able to repay some of this capital. However, both companies are entitled under the agreement to share in Melvin’s income and returns.

Citadel had double-digit overall gains last year. The Wellington Fund was up 26 percent, net of fees. A person who is familiar with these figures said that Citadel saw double-digit growth. Two people claimed that Point72 saw gains of 9.2 per cent.

GameStop is the clear winner. It grew 670% in 2021.