Michael Jordan is bleeding money since finding himself in the middle of the Reddit-fueled GameStop trading war that has sent shockwaves through Wall Street.
This stems from MJ welcoming hedge-fund investors Gabe Plotkin and Daniel Sundheim as business partners with his Charlotte Hornets NBA franchise.
Both have taken “catastrophic” losses, with the ongoing war between hedge-fund managers and amateur investors which reportedly wiped away somewhere in the $5B range from established hedge-funds.
Plotkin and his Melvin Capital fund had bet aggressively against GameStop by short-selling its shares, meaning they stood to gain if the price went down, but lose if it went up. So basically when the army of new, we’re gonna do it anyway amateur investors joined forces, things took a sudden and very drastic turn.
By joining forces they drove up GameStop’s stock price by more than 1700 percent in an attempt to stick it to Wall Street. It was unmitigated for the aforementioned Melvin Capital, and by association, Michael Jordan.
Melvin Capital took it as a loss and even conceded defeat last Tuesday. Plotkin even gave an interview stating his fund had closed its position in GameStop, meaning they’d chosen to take it in the chin and swallow these monstrous losses.
This really affects MJ who’s already lost somewhere in the ballpark of $230M over the last 12 months with COVID-19 crippling the NBA and team profits for the second straight season. There are more layers to this that are still being unfoiled, so we should know more in the coming days. Also, we don’t really know where the working relationship between MJ and the two investors lies at the current moment.
However, it looks as if MJ will scrape by, as Forbes has his current net worth listed at $1.6B, even after this epic disaster.