Sunday, February 25, 2024

Steve Cohen’s Point72 Raises $ 1.5 Billion

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Steve Cohen’s Point72 Asset Management raised $ 1.5 billion from investors, increasing the hedge fund’s assets under management after losing 10% in January and emergency funding to Melvin Capital, the firm at the center of the GameStop short squeeze.

Point72 took advantage of the new liquidity to take advantage of investment opportunities, according to a person close to the company.

Melvin, led by Mr. Cohen’s protege Gabe Plotkin, received $ 750 million from Point72 and $ 2 billion from rival Citadel last week after suffering large losses on his short positions. Retail traders coordination on Reddit drives up the shares of GameStop and other companies Melvin was betting against.

Point72’s 10% drop in January partly reflected a loss on its investments with Melvin, which has been a difficult month for many hedge funds.

Citadel lost less than 1% on the Melvin position in January and its flagship fund fell 3% over the year, according to a source close to the group.

The capital injection helped Melvin, who was down 53 percent by the end of January, increase its assets to 8 billion dollars.

Point72 attracted strong investor interest when it opened to outside investors in 2018, after the United States Securities and Exchange Commission lifted Mr Cohen’s ban on handling outside money. He told an audience at an event that year that he had raised $ 5 billion from investors, saying “it actually wasn’t that hard.”

During the coronavirus-related market turmoil of the past year, a number of the biggest names in the industry, including DE Shaw and Baupost, have raised funds from investors to try to take advantage of the investment opportunities that they had spotted.

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