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Renaissance Technologies piled into GameStop and AMC ahead of the rally

(Bloomberg) — Renaissance Technologies LLC, the quant fund founded by the late Jim Simons, loaded up on shares of meme stock darlings AMC Entertainment Holdings Inc. and GameStop Corp. before the last rally.

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The hedge fund purchased 3.82 million shares of AMC in the first quarter of 2024, strengthening its position in the theater chain, according to regulatory filings. At the same time, Renaissance also acquired 1 million GameStop shares, revealing a new position in the quarter ending March 31, according to filings.

Read more: Jim Simons, Code Breaker Who Mastered Investing, Dies at 86

Shares of AMC and GameStop more than doubled earlier this week, in a surge reminiscent of the meme stock trading craze of 2021, when retail traders bid up stocks up to record levels. The frenzy was sparked by a Sunday

The recovery has since calmed; AMC shares fell as much as 16% on Thursday while GameStop shares fell as much as 28%. Pressures remain, with both stocks trading well below pandemic peaks. Shares of AMC and GameStop both fell in the first quarter of 2024, falling 39% and 29%, respectively.

Renaissance did not immediately respond to a request for comment from Bloomberg News.

Of course, the filings are just a snapshot of the funds’ U.S. stock holdings that oversee more than $100 million. The data only tracks holdings through the end of March; the funds could have changed positions over the last month and a half.

“Quant funds/hedge funds are much better equipped to handle these situations these days,” Marco Iachini of Vanda Research wrote in a note to clients this week. “Rather, we believe the chances that they participate alongside retailers in the squeeze, but also rely on these trades, and then exit before retail traders, are high.”

Read more: GameStop and AMC extend crisis as meme-fueled rally unfolds

Renaissance wasn’t the only hedge fund trading the hottest meme stocks during the first few months of the year.

Balyasny Asset Management LP added AMC and GameStop in the first quarter. DE Shaw & Co Inc sold the pair. Citadel Advisors LLC unloaded AMC shares, while Schonfeld Strategic Advisors LLC and ExodusPoint Capital Management LP were among the hedge funds that liquidated their positions in GameStop.

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News Source : finance.yahoo.com
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