A Reddit Army Descends on Hedge Funds Chained by Risk Models
- Risk models seen fueling fund deleveraging in short squeeze
- Volatility also jumped as stock market correlations broke down
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A hellish week for hedge funds will be remembered for how much damage Reddit traders caused by chasing a handful of the most-shorted names in the $43 trillion U.S. stock market.
But just why were the institutional pros forced to downsize their market exposures at the fastest pace since pandemic-spurred March rout?