Should GameStop Help the Shorts and Issue More Stock?
Hedge funds that shorted GameStop (NYSE: GME) stock have a big problem. There's not enough stock to go around to let them cover their positions, so as the video game retailer's shares race higher day after day after day, the hedge funds are hemorrhaging money.
Financial analytics firm S3 Partners says short-sellers lost almost $1 billion on GameStop stock last year and are already down over $5 billion so far this year. They are losing more daily as they're caught in a vortex from which they can't escape, though there is a way out and it's GameStop itself that could save them. If it does throw them this life preserver, it could massively benefit the retailer, too.
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Source Fool.com
