AMC FTDs have reached new high records this year in both number of fails-to-deliver and dollar amount.
For the month of April, AMC FTDs soared between 17 million and 18 million, reaching new high records this year.
The dollar figure topped at $85.4 million on April 10th, though none of these number figures are cumulative.
FTDs, or Failure-to-deliver occurs when one party in a trading contract (whether it’s shares, futures, or options) fails to deliver on their obligations.
These failures derive due to buyers not having enough money to take delivery and pay for the transaction at settlement.
In the case of sellers, it means not having the goods to meet that transaction.
Failure-to-delivers can occur in options trading or when selling short naked, per Investopedia.
FTDs can also occur if there is a technical problem in the settlement process carried out by the respective parties (clearing houses).
In April, AMC CEO Adam Aron announced that the company had contacted both FINRA and the NYSE to look closely at the trading of their stock.
“Many of you, and we, are aware that AMC Entertainment has been on ‘The Threshold List‘ for 3+ weeks, indicating a number of FTDs.
Some of you may be pleased to learn that we have contacted both FINRA and the NYSE asking that they both look closely at the trading of our stock.”
However, the CEO has not updated shareholders on what the NYSE or FINRA said in regard to the skyrocketing volume of AMC FTDs or today’s new high record.
AMC Dark Pool Trading News and Updates
In May, data shows that more than 50% of AMC Entertainment’s (NYSE:AMC) volume is now consistently trading in dark pools.
Gary Gensler announced exclusively on Bloomberg that 90-95% of retail orders don’t go through the lit exchange.
The SEC Chairman says these orders are rerouted to dark pools rather than the NYSE.
Payment for order flow (PFOF) is also partly the reason why orders aren’t processed in the lit exchange.
He says retail orders go to wholesalers in an order-by-order competition.
“In the equity markets right now, if you place a market order, a retail market order, 90-95% do not go to the lit exchanges, do not go to Nasdaq or New York Stock Exchange, they go to wholesalers.
We The Investors Dave Laurer asked the SEC Chairman if dark pools suppressed the price of stock and whether retail investors could influence the price of a stock if majority of orders traded in the lit exchange.
While unsurprisingly there was no direct answer to the suppression of price, the Chairman says that with so much trading happening off-exchange, he doesn’t think it’s a leveled playing field as dark pools give institutions an “unfair advantage”.
“Retail investors as individuals don’t have the power to move the markets, but retail orders combined could have significant price impact.”
Latest AMC Institutional Ownership News
Antara Capital LP has disclosed a new massive short position against AMC Entertainment.
The institution has disclosed a whopping 55 million shares in put options valued at more than $277 million.
This is one of the largest short positions ever seen placed against the movie theatre chain.
Antara Capital only has 1 million shares in call options for AMC; this means its short position against the company is a 5,500% difference.
In April, Antara disclosed it shorted AMC Entertainment stock in an SEC filing.
“The exercise of a call option by a third-party holder obligated Antara Master Fund to effect a short sale of 10,700 shares of Class A Common Stock and borrow shares from an unaffiliated broker for delivery against the sale.”
“The exercise of a call option by a third-party holder obligated Antara Master Fund to effect a short sale of 600 shares of Class A Common Stock and borrow shares from an unaffiliated broker for delivery against the sale,” said the filing.
Antara disclosed shorting 11,300 total shares of AMC Entertainment from Wednesday, April 19 through Thursday, April 20.
The institution has been selling AMC stock all year according to their insider transaction history.
Some investors are criticizing CEO Adam Aron for having conducted business with Antara.
AMC FTDs are reaching new high records this year and the stock continues to be heavily traded in dark pools and outside the lit exchange.
AMC stock is currently up nearly +31% this year-to-date.
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