This is what I don't get, they are a hedge fund, even balanced book as you say, 200% gross exposure.
By your calculations they lost 0.5-1b from GME. That means 2b from somewhere else in the market.
Questions I'd have:
- even balanced book in my mind means they hedge risk and shouldn't lose across the board 30% in a week otherwise they are incompetent... and they seem far from that.
- with that in mind, how would they lose 2b in the rest of the market?, that means they dont hedge properly.
- As for GME, they didnt do proper risk management but that seems the only place they got blindsided. (Still surprising they had no insurance for a short squeeze...)
- Overall the stated losses were 30% of portfolio in a week... with only GME moving... you can see why I assume it was more then 14% and your logic seems flawed.
By your calculations they lost 0.5-1b from GME. That means 2b from somewhere else in the market.
Questions I'd have:
- even balanced book in my mind means they hedge risk and shouldn't lose across the board 30% in a week otherwise they are incompetent... and they seem far from that.
- with that in mind, how would they lose 2b in the rest of the market?, that means they dont hedge properly.
- As for GME, they didnt do proper risk management but that seems the only place they got blindsided. (Still surprising they had no insurance for a short squeeze...)
- Overall the stated losses were 30% of portfolio in a week... with only GME moving... you can see why I assume it was more then 14% and your logic seems flawed.