5 Worst Performing Hedge Funds of 2021

1. Melvin Capital Management

YTD Loss as of November 2021: 41.5%

Melvin Capital Management was one of the most high-profile casualties of 2021. The fund, based in New York and chaired by Gabriel Plotkin, was one of the hardest-hit by the GameStop short squeeze at the beginning of the year, losing billions in the saga. It was later bailed out through $3 billion given by billionaires Ken Griffin and Steve Cohen. Overall, the fund had losses of nearly $7 billion in 2021. Reports indicate that the fund is now looking to raise money for a new portfolio in 2022. 

One of the top holdings of Melvin Capital Management is Mastercard Incorporated (NYSE:MA), a payments technology firm. Among the hedge funds being tracked by Insider Monkey, Virginia-based investment firm Akre Capital Management is a leading shareholder in Mastercard Incorporated (NYSE:MA), with 5.8 million shares worth more than $2 billion. 

In its Q4 2020 investor letter, Bretton Fund, an asset management firm, highlighted a few stocks and Mastercard Incorporated (NYSE:MA) was one of them. Here is what the fund said:

“While consumers resumed much of their spending by summer, what and how they used their Visas and Mastercards changed. For obvious reasons, people shifted to contactless payments—one of the Covid-era changes we think is permanent—and replaced travel purchases with online shopping and food delivery. Consumers spent more on their debit cards and less on their credit cards; Visa and Mastercard make more per transaction on the latter. They also make more on cross-border transactions that come mostly from international travel, which ground to a halt early in the pandemic. Visa’s and Mastercard’s earnings per share fell by 7% and 16%, respectively, compared to their usual mid-teens growth. We’re not too worried, and we think they’ll catch up nicely in the post-vaccine world. Visa’s stock returned 17.1% and Mastercard’s 20.2%.”

You can also take a peek at 10 Undervalued Tech Stocks to Buy Now and 10 Most Successful Tech IPOs of 2021.

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