AMC Entertainment (NYSE:AMC) stock plunges after being removed from the NYSE Threshold Securities List; this should not be happening.
The SEC (Securities and Exchange Commission) violated the 13-Day Threshold List Rule after AMC remained listed for more than 25 consecutive days.
AMC CEO Adam Aron said on Twitter he asked the NYSE and FINRA to look into the stock due to the alarming amount of FTDs in market.
But the CEO never publicly demonstrated a letter confirming the bold claims.
Videos have surfaced of the CEO scrutinizing any talks about market manipulation during an in-theatre event.
Yahoo Finance published a segment on AMC being on the threshold list highlighting the cause being due to naked short selling.
“Market Makers, like those at the New York Stock Exchange, Citadel is one, they can engage in naked short selling and it’s perfectly legal, it’s part of their market making duties to provide liquidity for a stock.”
The problem is naked short selling isn’t ‘legal’ and it takes advantage of a company’s stock price by driving shares down even when demand from retail buyers is high.
Naked short selling isn’t supposed to be illegal from a regulatory perspective and legal whenever Wall Street decides it to be.
Shares of AMC Entertainment fell -15% on Tuesday.
AMC stock went from being up more than +110% this year to now being up only +18%.
What Should Have Happened Instead?
The 13-Day Threshold Rule states that a broker-dealer with fail-to-deliver positions for 13 consecutive settlement days must immediately close out the ‘FTD’ position by purchasing shares in the open market.
AMC’s share price should have surged in a buy-back or ‘repurchase’ of shares in the lit exchange.
AMC FTDs spiked up to more than $36 million in FTDs last month, through the report is still in the process of updating via T+35.
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.
This is a direct result of naked short selling in a company stock, according to Yahoo Finance.
So far, there’s been zero positive impact on the price from AMC being removed from the threshold list.
The only thing shareholders can do now is wait for the approved proposals to go into effect after AMC’s lawsuit has concluded.
Leave your thoughts on what’s happening with AMC today
The company has been through a lot, and so have shareholders.
Shareholders are either more level-headed than they ever were before, or more fearful — and it’s quite easy to see on social media.
How is AMC Entertainment standing in your eyes?
Is this just another bump on the road like we’ve seen in the past with AMC stock?
Or does it seem a little more serious?
Leave your thoughts below and share this article to get your voice heard.
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About The Author
Now who can properly explain our latest massive plunge?
Honestly, at a loss for words. This level of blatant corruption in broad daylight is astonishing. It’s what happens when people are allowed to cheat the system with no repercussions.
Fraud and corruption, same as every other day with AMC.
If this is capitalism then I would consider myself a non-believer. Wall Street is like a child given too much candy and spoiled rotten with no rules. Franklin Roosevelt must have seen the true desire of man and created Social Security to combat this weakness… That is wall street.
AA rigged the vote and is using the “lawsuit” to expedite his reverse split which will wipe out all the alledged synthetic shares. He is nothing more than a criminal and has lost the respect of the majority of AMC shareholders, regardless of what the “vote” suggests
Company’s focus is staving off bankruptcy by generating enough cash flow to stay in business. AA’s path to fighting short seller thesis is by making the company profitable and sustainable not a short squeeze or MOASS. The priority between retail and company isn’t exactly the same. If anyone believes the company is worth saving then don’t complain about the short squeeze not happening fast enough. It will happen in due time but there isn’t a set date.
The Meme stocks are getting screwed over and over again. They hide all the buying in dark pools and clean up by naked shorting the stock. They won’t get fooled again, will we?
AMC should have squeezed a long time ago , but the SEC working with AA has stopped it several times . And I have no faith in the system period
I agree. There is some nasty shit going on and continuing to go on. AA’s reaction doesn’t make sense. Where is the outrage Mr. Aron?
Leave your thoughts below!