Tag: Gunjan Banerji

Behind the Mysterious Demise of a $1.7 Billion Mutual Fund

Mary Pat Campbell

Link: https://www.wsj.com/articles/behind-the-mysterious-demise-of-a-1-7-billion-mutual-fund-11618911000

Excerpt:

A U.S. mutual fund that suffered nearly $500 million of losses appears to have misvalued its large derivatives portfolio, according to an analysis of the fund’s disclosures by The Wall Street Journal, academics and traders.

The Infinity Q Diversified Alpha Fund disclosed in filings with the Securities and Exchange Commission valuations of investments that in at least three instances were incorrect or inconsistent with market conditions, said traders and academics. One valuation was mathematically impossible, said a former Morgan Stanley managing director who reviewed the disclosures.

In one instance, the disclosures show, Infinity entered two nearly identical swaps contracts referencing the same index over the same period, yet booked a gain on one that was more than three times as large as the other—an outcome analysts said defied logic. Swaps are bilateral contracts, brokered by banks, that traders use to bet on asset prices, interest rates or other financial trends.

Author(s): Gunjan Banerji

Publication Date: 20 April 2021

Publication Site: Wall Street Journal

Keith Gill Drove the GameStop Reddit Mania. He Talked to the Journal.

Mary Pat Campbell

Link: https://www.wsj.com/articles/keith-gill-drove-the-gamestop-reddit-mania-he-talked-to-the-journal-11611931696

Excerpt:

The investor who helped direct the world’s attention to GameStop, leading a horde of online followers in a bizarre market rally that made and lost fortunes from one day to the next, says he’s just a normal guy.

“I didn’t expect this,” said Keith Gill, 34 years old, known as “DeepF—ingValue” by fans on Reddit’s WallStreetBets forum and “Dada” by his 2-year-old daughter. He said he didn’t set out to draw the attention of Congress, the Federal Reserve, hedge funds, the media, trading platforms and hundreds of thousands of investors.

“This story is so much bigger than me,” Mr. Gill told The Wall Street Journal in his first interview since the unboxing this week of a volatile new stock-market game. “I support these retail investors, their ability to make a statement.”

Author(s): Julia-Ambra Verlaine and Gunjan Banerji

Publication Date: 29 January 2021

Publication Site: Wall Street Journal

GameStop Mania Reveals Power Shift on Wall Street—and the Pros Are Reeling

Mary Pat Campbell

Link: https://www.wsj.com/articles/gamestop-mania-reveals-power-shift-on-wall-streetand-the-pros-are-reeling-11611774663?mod=djemwhatsnews

Excerpt:

Long-held strategies such as evaluating company fundamentals have gone out the window in favor of momentum. War has broken out between professionals losing billions and the individual investors jeering at them on social media. Meanwhile, the frenzy of activity is stirring regulatory and legal concerns, as well as the attention of the Biden administration. The White House press secretary said on Wednesday that its economic team, including Treasury Secretary Janet Yellen, is monitoring the situation.

The newbie investors are gathering on platforms such as Reddit, Discord, Facebook and Twitter . They are encouraging each other to pile into stocks, bragging about their gains and, at times, intentionally banding together to intensify losses among professional traders, who protest that social-media hordes are conspiring to move stock prices.

Author(s): Gunjan Banerji, Juliet Chung and Caitlin McCabe

Publication Date: 27 January 2021

Publication Site: Wall Street Journal