Ahead of a grilling by lawmakers over the frenzied trading in retailer GameStop, Melvin Capital Management Chief Executive Gabriel Plotkin, Robinhood Markets CEO Vladimir Tenev and Keith Gill, a YouTube streamer known as Roaring Kitty, laid out their defense.
Here are key quotes from the testimonies here of the players involved and here is a link here to biographies of some of them.
KEITH GILL, YOUTUBE STREAMER:
“I’m as bullish as I’ve ever been on a potential turnaround. In short, I like the stock.”
“I grew up playing videogames and shopping at GameStop… I knew the company had an opportunity to reinvigorate this business.”
“The investment I made was risky, but I was confident in my analysis, and I was willing to accept the loss if I was proven wrong. My timing was far from perfect, and many of the options contracts I purchased expired worthless because GameStop’s stock price remained depressed longer than I expected.
“I’ve been asked why I decided to share my investment ideas on social media. My investment skills had reached a level where I felt sharing them publicly could help others.”
“Ultimately my GameStop investment was a success… I was so happy to visit my family in Brockton for the holidays and give them the great news – we were millionaires.”
GABRIEL PLOTKIN, FOUNDER, MELVIN CAPITAL MANAGEMENT:
“We had been short GameStop since Melvin’s inception six years earlier because we believed and still believe that its business model – selling new and used video games in physical stores – is being overtaken by digital downloads through the internet.”
“In January 2021, a group on Reddit began to make posts about Melvin’s specific investments… Many of these posts were laced with anti-Semitic slurs directed at me and others… Others sent similarly profane and racist text messages to me.”
“When this frenzy began, Melvin started closing out its position in GameStop at a loss, not because our investment thesis had changed but because something unprecedented was
happening. We also reduced many other Melvin positions at significant losses – both long and short – that were the subject of similar posts.
“Investors in Melvin suffered significant losses. It is now our job to earn it back.”
VLADIMIR TENEV, ROBINHOOD:
“In the face of … unprecedented volatility and volume… Robinhood Securities placed temporary restrictions on certain securities to facilitate compliance with clearinghouse deposit requirements, thereby allowing Robinhood to continue to serve our customers and comply with all trading regulations.
“The action we took was for one reason and one reason only: to allow us to continue to meet our regulatory deposit
STEVE HUFFMAN, CO-FOUNDER & CEO OF REDDIT
“A few weeks ago, we saw the power of community… when the traders of WallStreetBets (on Reddit) banded together at first to seize an investment opportunity not usually accessible to retail investors.”
“We have … analyzed the activity in WallStreetBets to determine whether bots, foreign agents, or other bad actors played a significant role. They have not. In every metric that we checked, the activity in WallStreetBets was well within normal parameters, and its moderation tools were working as expected.”
KENNETH GRIFFIN, FOUNDER AND CEO OF CITADEL, FOUNDER AND PRINCIPAL SHAREHOLDER OF CITADEL SECURITIES
“We had no role in Robinhood’s decision to limit trading in GameStop or any other of the “meme” stocks.
“During the period of frenzied retail equities trading, Citadel Securities was the only major market maker to provide continuous liquidity every minute of every trading day. When others were unable or unwilling to handle the heavy volumes, Citadel Securities stepped up.”