The ViacomCBS logo will be displayed on the Nasdaq MarketSite to celebrate the company’s merger on December 5, 2019 in New York.
Brendan McDermid | Reuters
Some of the strong selling pressure on select US media stocks and Chinese Internet ADRs on Friday was due to the forced liquidation of positions held by billionaire family office Archegos Capital Management, according to a source with direct knowledge of the situation.
Archegos Capital was founded by former Tiger Management equity analyst Bill Hwang.
Media stocks ViacomCBS and Discovery, which saw massive gains this year, came under unusually strong selling pressure late this week and are said to be at least two of the stocks in question, along with Chinese internet names Baidu, Tencent, Vipshop and several others.
IPO Edge reported the news first.
ViacomCBS and Discovery closed more than 27% on Friday, with Viacom losing more than 50% for the week while Discovery was down 45%. Companies have been cut sharply due to investor skepticism about their long-term prospects in a crowded media landscape.
During the week, Baidu was down more than 18%, Tencent was down more than 33%, and Vipshop was down more than 31%.
CNBC reached out to Archegos Capital, but calls and emails were not returned. The source said the forced sales are likely related to margin calls from heavily leveraged positions.
CNBC has also learned that Teng Yue Partners, an Asia-facing fund operated by another former Tiger management analyst, Tao Li, has been negatively impacted by drawdowns in several of its key positions. Although the fund is said to have declined in March, it was still positive year over year, according to the source.
CNBC has also reached Teng Yue.
– CNBC’s Leslie Picker contributed to this report.