Hedge funds may be incentivized to close their short positions in AMC stock as the cost to borrow increases. At some point, it’s not worth paying that high of a fee to continue shorting a company that has fundamentally improved.
AMC is no longer the same endangered company it once was during the pandemic.
The company has improved every quarter since 2021 and has managed to get rid of a lot of debt.
The world’s largest movie theatre continues to innovate and adapt to the changing world.
While online streaming threatened the industry, revenue from box office hits has proved people are still going to the movie theatres, despite the convenience of watching movies at home.
Short sellers are betting against a recovering and innovating film industry generating billions in revenue now.
As AMC continues to prove itself fundamentally and the cost to borrow rises, expect short sellers to begin closing their short positions.
Here is where patient investors will see massive returns.
AMC Short Squeeze – AMC Entertainment 2023 – AMC Stock Price – AMC Stock Squeeze
Will AMC squeeze This Year?
The Fool thinks you should sell your stock, but retail investors aren’t budging.
Mainstream media who serve hedge funds in a conflict of interest have been egging retail investors to not buy the stock all of 2021.
If you listened to The Fool who told you not to buy AMC when its share price was low, then you would have missed out on a trade that went as high as 3000% in gains!
While the runup to $72 per share might have caused AMC’s short interest to drop to 14% from 20%, AMC’s short interest has now gone up to 22%.
Ladies and gentlemen, AMC stock has plenty of room for growth in 2023.
Welcome to Franknez.com – the blog that provides retail investors market news with integrity. Today we’re discussing AMC’s short interest data to determine whether it will squeeze in 2023.
Will AMC stock squeeze in 2023? Game over short sellers | AMC Stock 2023 – AMC Stock Price
AMC has a high enough short interest to squeeze shorts from their positions in 2023.
Sitting at 24% short interest, it’s more than enough to get the price up well into the high hundreds of dollars per share.
Whether regulators will investigate naked shares, FTDs, and other forms of counterfeit shares for hedge funds to cover is another topic.
AMC will need momentum if it’s to see another massive runup in share price.
Furthermore, hedge funds will lead their customers into losses for the second year in a row if retail investors continue to buy and hold the stock in 2023.
AMC Entertainment stock has plenty of room for growth and mainstream media doesn’t want you to know it.
If you’re lucky enough to get involved in the ape community you’ll find yourself fighting for a fair and transparent market, where your voice means everything.
The AMC community has not had a problem holding or buying the stock.
One of the biggest problems the community faces today is regulators not protecting retail investors against the predatorial strategies from hedge funds.
The community has always been a beacon for change.
Apes will need to voice market concerns to elevate awareness.
AMC stock had multiple chances to squeeze in 2021, however, hedge funds always found a loophole that would prevent them from reporting information, or trading stock in the lit exchange.
Market manipulation continues to be a threat to every retail investor in the market.
AMC Entertainment was on the brink of extinction, it was about to go bankrupt.
Hedge funds took this opportunity to overleverage their short positions in the stock, betting it would close forever.
Once retail investors got in and saved the company, the community uncovered a number of market manipulation tactics that allowed hedge funds to prevent the stock’s share price from soaring.
The fight for a fair market continues in 2023.
For the ape community, this is more than just a short squeeze play.
Your support helps maintain all the costs it takes to run a blog at this scale.
Together, we’ve been able to place AMC Entertainment articles on the #1 page results on Google and get featured on the ‘news’ section, combating mainstream media.
The mission of this platform is to spread the truth corporate media isn’t willing to, by giving the people in our community a voice.
Market News Daily: AMC CEO fatigued by manipulation talks.
AMC Entertainment (NYSE:AMC) CEO Adam Aron touches on billions of synthetic shares and market manipulation.
For years now, AMC shareholders have stuck to their convictions on a mother of all short squeezes (MOASS) due to the alarming amount of overleveraged shares out in the market that institutions still have to buy back.
AMC Entertainment stock has been shorted in the past by some of the biggest short sellers on Wall Street, though now they are playing both sides to hedge their bets.
Notorious short seller Citadel has a long history of market manipulation, Chairman Gary Gensler says more than 50% of trading goes through dark pools, and Patrick McConloguge, an ex-Citadel data scientist says the game is rigged and that rules are tailored to benefit hedge funds.
But AMC CEO Adam Aron says that is not the company’s problem, despite thousands of investors urging the company to take an activist role in lifting the suppression that keeps the stock price from rising.
Investors managed to raise AMC shares from $2 to $20, and from $5 to $72 per share — though halts and other forms of suppression limited how high the stock was allowed to go.
Shareholders have felt cheated ever since and have urged AMC’s CEO to take legal action against naked shorts like other CEOs are currently doing.
But AMC’s CEO has recently expressed a strong message towards the manipulation occurring in his company stock.
And quite frankly, the CEO expresses he’s tired of investors talking about it.
Let’s dive right into it.
AMC CEO on Billions of Synthetic Shares
AMC CEO Adam Aron on Synthetic Shares.
In August 2022, just moments before the debut of AMC’s Preferred Equity, APE, Adam Aron released the following statement:
“Candidly, I’ve seen no evidence so-called fake or synthetic shares exist. But many of you disagree. This preferred equity dividend goes ONLY to company issued shares. So, it will have the impact of a “share count” or unique dividend many of you have sought.”
This alarmed many investors at the time with a few die-hard followers calling anyone who mentioned this news as ‘bot’, ‘shill’, or ‘fud’ — completely unnecessary of course but it paints the environment well.
Other Twitter influencers promised shareholders APE was the catalyst to an epic short squeeze but failed to explain the equity’s true purpose.
In other words, only a half-truth was being spread within the community which caused shareholders to hold even deeper losses.
A video surfaced on social media of Adam Aron speaking on market manipulation that has many investors somewhat divided — though it shouldn’t.
And I’ll explain why in a moment.
The CEO says, “guys, don’t believe everything you read on Twitter. Yes, it’s true that we have a lot of short sellers who have sold our shares short, but all that stuff that you read about market manipulation, and fail to delivers, and all this other stuff, there’s billions of synthetic shares out there — that’s not our problem.”
Adam Aron said on Twitter the company had reached out to the NYSE and FINRA to look into the high number of FTDs but failed to provide any sort of letter confirming the claims.
Shareholders are confused to say the least with what the CEO had to say during one of his events.
I guess we been wrong all along about #amc market corruption. Wow Adam A. Are you kidding me !!!!!! pic.twitter.com/Od3F8o1hYc
— 🇺🇸 Mike “The Marine” Entertainment 😉🦅 (@themarinexxx) March 13, 2023
Is the CEO is experiencing fear, uncertainty, and doubt?
In another video, the CEO can be heard telling a shareholder, “You don’t know what you’re talking about. You’re just wrong. You’re just wrong across the board. There are no synthetic shares.”
— Golfer,Car Enthusiast,Dog Lover,AMC Surporter (@iamBazSR3rs) March 14, 2023
Despite not being one of the most peppy AMC updates, it sure is something worth raising awareness about.
What the CEO says and what you have seen are going to reinforce your conviction or lack thereof.
However, there are always two sides to a coin.
In the full video, you can also hear the CEO state that essentially running the company fundamentally is more important than the manipulation happening in the company stock.
All shills posting snip of @CEOAdam speech – here’s rest of it. More business/ cash kills short thesis! Market will take care of naked shorting/ short sellers! pic.twitter.com/63ifmSIi3l
The clips are rubbing many investors the wrong way but shouldn’t be take completely out of context.
Still, investors feel the CEO should not discuss market injustices if he’s not willing to tackle them.
Why is This Important?
Market News Daily: Adam Aron tired of market manipulation talks.
There are millions of investors out there who have witnessed the market manipulation single handedly for years and now they’re being told it’s not important — or rather it doesn’t exist, when real data, reports, and whistleblowers have stated otherwise.
Though the CEOs controversial statements might have investors divided, it shouldn’t.
In the end, a shareholder is a shareholder and everyone has a choice to make based on what’s happening in the market and with the company.
Some shareholders are indifferent, simply waiting to collect profits when shorts start closing their positions.
The short interest was lower when AMC shares ran up to its all-time high of $72 per share in 2021.
Time will tell where AMC’s share price goes from here on out.
What do you make of AMC’s CEO’s thoughts on the manipulation?
Was this the proper way to address shareholders and the community who have been fighting for change in the financial system?
Out of the market injustices that have occurred ever since the ‘meme stock’ frenzy, ‘We The Investors’ has established a legitimate voice for the retail community and has been able to speak to Chairman Gary Gensler on concerns and issues investors are currently facing.
We’ve also been able to raise enough awareness to bring certain issues to light by bigger media outlets, ensuring your voice is heard.
Leave your thoughts below.
Originally published on March 15, 2023.
Market News Published Daily
Market News Today – AMC CEO tired of Manipulation Talks.
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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.
Market News Today – AMC removed from threshold list.
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.
Market News Published Daily
Market News Today – AMC removed from threshold list.
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Franknez.com is the media site that keeps retail investors informed.
Market News Today – AMC Reverse Stock Split on Hold Until After Lawsuit Clears.
Shareholders have approved an AMC reverse stock split as well as the conversion of APE equity to common AMC stock, but CEO Adam Aron says they cannot implement the proposals until the Delaware lawsuit clears.
“Today was a huge step forward for AMC. You voted YES, YES & YES! And it was a landslide vote too — 88% yes for Proposal 1, 87% yes for Proposal 2, and 87% yes for Proposal 3. My sincerest thanks for giving AMC the tools we need to continue fighting the good fight on your behalf.
Saving AMC is my professional mission. And remember that I own millions of AMC shares and APE units too. So, I very much want for AMC to succeed. I am absolutely and passionately convinced that what you approved today is in the best interests of AMC and of all our shareholders.
So what happens now? We can not implement what you approved today until the litigation in Delaware courts is resolved. The next Court hearing on this matter is set for April 27, 2023. We will update stockholders when we have additional information.”
The 1-for-10 reverse stock split will divide shares by 10 and multiple AMC’s share price by 10.
For example, with AMC’s current share price today at $4.60, the stock price will reflect $46 but shareholders holding 100 shares will now hold 10 shares.
Investors holding 1,000 shares of AMC stock will hold 100 shares after the reverse split.
Allegheny County Employees’ Retirement System filed a lawsuit against AMC Entertainment (NYSE:AMC) claiming that the company and several of its directors violated state law to “eviscerate” the voting power of common stockholders, who had not supported issuing new shares.
The Purpose Behind a Reverse Stock Split
Market News Daily – AMC Reverse Stock Split on Hold Until After Lawsuit Clears.
AMC Entertainment, while it’s improved drastically over the past two years, continues to burn cash.
Developments such as AMC Perfectly Popcorn and branded merchandise are just two innovations the company has created to increase revenue.
While the developments are still new, AMC needs big cash quick, which is why a reverse stock split and APE merge was proposed.
An AMC and APE merge will combine the value of both the equity and common stock of the company.
A reverse stock split will buy the company time and stay listed on the NYSE as short sellers continue to drive shares down — this time from a higher share price than current levels.
The approved proposals will dilute the stock by increasing the number of shares from 524,173,073 to 550,000,000.
This gives AMC Entertainment millions of shares to liquidate as soon as they hit the market, allowing the company to raise big cash once again.
However, the reverse stock split now makes it 10 times more challenging for shareholders who got in at the peak of 2021 to break even.
Shareholders will have to repurchase 10 times their shares to be unaffected by this type of dilution.
This repurchase may have the potential to move stocks up, but at a hefty cost.
Market News: Citadel and friends are entering the crypto space | Ken Griffin.
Ken Griffin and friends are entering the crypto world very soon — investors are concerned as Citadel has a history of several violations and fines.
EDX Markets plans to bring ‘traditional finance’ to the crypto space, a not so ‘traditional’ space to begin with.
The exchange made up of Citadel, Sequoia, Paradigm, Virtu, Charles Schwab, and Fidelity is debuting in November.
EDX Markets will start trading a limited number of spot, crypto tokens starting with a November trial period, with the official launch in January, per Bloomberg.
Similar to trading equities and options, EDX will allow investors to buy and sell digital assets through their existing broker dealer, rather than an outside venue or directly through a crypto-native exchange.
“We’re taking some of the best features of traditional finance and bringing it to the digital markets to make it more efficient, and bring that cost saving to investors,” Nazarali said.
Nazarali is the former global head of business development at Citadel Securities.
But as many are aware, these financial institutions have a long history of playing unfair.
Will these sharks taint the crypto space too?
Let’s look at Citadel’s market manipulation history as well as other Citadel violations and fines in the past.
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Citadel Market Manipulation
Citadel violation and fines – market manipulation.
2015
In 2015, an account operated in China by the brokerage arm of US hedge fund Citadel was suspended.
It was the latest casualty of regulators’ hunt for market manipulators and short sellers at the time.
The China Securities Regulatory Commission said that the Shanghai and Shenzhen stock exchanges had suspended 24 accounts as part of a probe into high-frequency trading.
The investigation focused on a practice known as “spoofing” in which an investor submits a buy or sell order but then withdraws it before a sale is completed — a practice that can mislead investors by creating the false impression that a stock is trading at a particular price.
Citadel confirmed that one of its accounts managed by Guosen Futures was among those suspended.
2017
In 2017 Citadel was fined by the SEC $22.6 million to settle charges of misleading conduct.
The hedge fund misled customers about the way it priced trades.
The SEC found that between 2007 and 2010, Citadel used two algorithms to execute stock trades on customers’ behalf that gave investors a worse price for their trades, even when Citadel knew better prices existed elsewhere.
“This affected millions of retail orders,” said Stephanie Avakian, the acting director of enforcement at the SEC at the time.
Citadel neither admitted nor denied the findings.
2021
Citadel violations and fines – market manipulation.
In 2021, Failure-to-Delivers (FTDs) rose dramatically in the period leading up to January 28th, 2021, a phenomenon consistent with increasing short interest by market makers such as Citadel Securities.
FTDs are indictive of naked short selling, which occurs when a short seller does not actually possess the security it is supposed to borrow.
This practice is largely inaccessible to individual investors but accessible to market makers.
At the time, Citadel, Robinhood, and others restricted retail investors from buying ‘meme stocks’ in order to prevent escalating institutional losses.
Citadel eventually lost billions after betting against AMC Entertainment in 2021.
The Chicago Tribune published a piece explaining exactly what retail investors have been warning the SEC about.
Citadel Securities’ dark pool dominates a big part of the financial world, accounting for as much as half of U.S. stock market activity.
The Chicago Tribune says this prominent dark pool is run by Chicago Billionaire Ken Griffin’s Citadel Securities and has been targeting small scale retail investors.
And they’re not wrong.
Dark pools are typically involved in payment for order flow (PFOF), where they pay broker firms to receive retail order flow.
Brokers such as Robinhood and TD Ameritrade accept payment for order flow.
But retail investors have been bringing these nefarious practices in the market to light.
In this article, we’re going to go over some of the latest developments in AMC, it’s history since redditors took over, and an AMC short squeeze update for the year of 2023.
AMC keeps on keeping on, and although AMC has been on discount recently, retail investors continue to buy and hold it.
Retail investors remain excited about the data that has been collected for years now.
Will we see an AMC short squeeze while we continue to ride today’s bear market?
And if so, how soon?
Welcome to Franknez.com – the blog providing you with content on stocks, crypto, and market news. Today we’re discussing AMC Entertainment stock and its short squeeze update and history.
Lets get started!
How soon will we see an AMC short squeeze?
Retail investors all want to know.
Is it this week?
Will it be next week?
Or, are we looking at a longer game here?
Here’s what we know.
Key Highlights
AMC closed at $5.46 on March 13th. The stock continues to be heavily shorted. AMC Entertainment is set up for a short squeeze despite its split.
Shareholders continue to buy and hold the stock.
AMC’s short interest data shows us the stock has the perfect setup for a short squeeze.
Below is a series of documented facts and positive news that all influence AMC’s potential towards a short squeeze.
“Since reopening our first theatres with AMC Safe & Clean in August, AMC has welcomed back nearly 10 million moviegoers nationwide without a single reported case of COVID-19 transmission among moviegoers at our theatres. We look forward to welcoming back our New York City guests to the big seats, big sounds and big screens that are only possible at a movie theatre.”
Adam aron, President and CEO of AMC Entertainment
For those who thought AMC was a dead company, think again.
The company is now generating big revenue since it’s reopening and has beat every quarter since 2021.
Positive News for AMC Entertainment (Archive 2021)
Adam Aron gives positive news on AMC Entertainment – Archive 2021
AMC Entertainment has raised more than 2.2 billion dollars in cash
90% of AMC theaters in the United States are now open with New York and Los Angeles finally reopening
Vaccinations and policies are making movie theaters safe
New movie titles are guaranteed to increase sales revenues
CEO and President Adam Aron expresses an optimistic future for AMC Entertainment
AMC Entertainment has implemented a Safe & Clean program under the advisement from Harvard University’s prestigious School of Public health as well as well as the No. 1 U.S. cleaning brand, The Clorox Company. This means movie goers can now return at ease knowing a proper sanitation program has been put in place.
Hedge fund affiliate partners such as MarketWatch, The Fool, and other finance website have been trying to redirect the public from investing in this stock.
That’s primarily because hedge funds are losing millions by the day.
A short squeeze could even put them out of business.
This is why it’s important and always has been for me to spread any positive news surrounding AMC.
I don’t believe in the manipulation of the media and I will continue to update these articles as more great news unfolds.
Experts, analysts, and shareholders can’t identify an exact date and time.
However, the possibility of an AMC short squeeze is certainly possible given that it is still a very heavily shorted stock.
We also now have more data then ever before that indicate a massive short squeeze is almost certain to happen.
Especially now that the SEC has announced some crackdown on shorting.
With Melvin Capital and other hedge funds out of the picture, it’s only a matter of time before others close their positions.
It’s tendie time!
Analyst AMC predictions 2021
With that being said, Trey’s Trades predicted a short squeeze in 2021. Trey has been a leader in the AMC community, though he’s recently taken time off from stock content on YouTube.
Data points towards AMC stock reaching $1000+ per share.
See what Trey had to say.
AMC short squeeze – AMC Stock Forecast – AMC Stocktwits
The real question is, how can retail investors make this AMC short squeeze happen?
We know that short-sellers eventually have to close their positions. This means that they will eventually have to buy AMC stock at the current share price.
If retail investors continue to drive the share price up by buying the dip and holding their positions, short-sellers will have no other option than to buy from the retail investor at a higher share price.
2. Retail investors will also need to buy the climbs in order to show a demand for the stock. This doesn’t have to be huge buys, rather incremental to validate the current share price.
This play essentially creates a supply and demand scenario between retail investors and short-sellers.
The results? A short squeeze.
Just make sure to take your profits.
The last thing you want is to see your gains turn into losses.
Hedge funds are doing everything they can to prevent a short squeeze
How are they doing this?
By promoting false information online (we’re certain you’ve seen it)
Through strategies such as short-ladder attacks in the market
And, by restricting certain brokerage accounts from allowing its retail investors to purchase or buy shorted stocks (Robing hood)
This is what retail investors can do to fight corruption:
Share content that presents facts (blog posts, analysis videos, etc.)
Continue to educate yourself and make investment decisions based on your personal analysis
We’ll begin to see a trend similar to that of GME (Gamestop). AMC will enter a bullish territory before hitting an ‘abnormal’ peak in which AMC would have ‘squoze’.
If an AMC short squeeze doesn’t occur, AMC stock price will still go up allowing shareholders to make at least some sort of profit.
That is, for those whose majority of shares were purchased at today’s current lows.
With AMC theaters now open, it’s inevitable that the company will begin to see bigger sales revenue every time a new title is released.
Keep in mind that AMC’s share price during the booming party economy of 16′ was roughly around $30 per share.
If a short squeeze doesn’t happen, fundamentals will continue to bring the stock up as more investors are buying the stock.
However, a short squeeze not happening is very unlikely as AMC is currently still one of the most heavily shorted stock in the market and most held stock, beating both Apple (AAPL) and Tesla (TSLA), via. NASDAQ.
Majority of the float is also held by retail investors, so the company has a huge support.
AMC hasn’t squeezed yet primarily to two main reasons.
The stock requires volume to drive the stock price action up
Shorts need to close their positions
Volume will surge as more and more retail investors (as well as institutions) get in on AMC stock.
Regarding shorts closing, retail investors need to squeeze them out of their positions by holding their positions and helping increase AMC’s short borrow fee.
You can keep tabs on AMC’s short borrow fee as it changes every day via. Ortex, or Fintel.
In 2021, Wanda Group had caused a little bit of disruption for retail investors by profiting on the first sight of gains.
This turmoil was only short-term but is a reason why we’ve seen some selloff in the market a few weeks ago.
However, Adam Aron has brought awareness in an interview with Trey’s Trades that this selloff from Wanda is simply policy from China.
Despite going around the breaking partnership, Wanda cashed out completely two years ago, making retail investors the biggest stakeholder in the company.
Is AMC Ever Going to Squeeze?
All the numbers point towards the right direction for a massive short squeeze.
Shorts and hedge funds continue to lose money every day.
Interactive Brokers Chief Strategist Steve Sosnick says there’s big demand to short AMC Entertainment (NYSE:AMC) stock.
He says the biggest reason aside from the company’s fundamentals is its new merge with its equity (NYSE:APE).
“It’s very hard to keep the momentum in these things because economic reality does take hold.
Bed Bath & Beyond, at one point was the best performing stock on the board until reality set in and they began defaulting, averted bankruptcy, but using a deal that is so dilutive that it’s unavoidable.”
Sosnick says AMC is in a very special situation because of the proposal to merge APE with AMC common shares.
“Right now we’re seeing such a demand to short AMC partly because of its difficulties but partly because of the special situation.
This really is what they were looking for in some ways as the mother of all short squeezes.
The borrow rate, it costs you 700% to borrow the shares overnight — if you can find them,” said the Interactive Brokers Chief Strategist on Yahoo Finance.
Is AMC Entertainment stock about to squeeze this year?
“Redditors, thank you so much for helping create the best pipeline we’ve ever had”, said Ken Griffin on Business Insider.
Ken Griffin, on how the GameStop frenzy helped raise Citadel’s profile with potential hires.
Business Insider says the SEC found no truth to any of the conspiracy theories but how can the SEC really go against one of the most powerful hedge funds in the world?
Transcripts showed Citadel and Robinhood did in fact have “blunt negotiations” the night prior to the halts.
A Miami district court judge admitted the Citadel and Robinhood transcripts were suspicious.
However, the federal court has dismissed the case due to a ‘lack of evidence’.
Let us know in the comments section below what an AMC short squeeze would mean for you!
If you’re an AMC shareholder let us know in the comment section below.
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This means the SEC (Securities and Exchange Commission) is in direct violation of the 13-day threshold rule.
What is the 13-day threshold rule?
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.
There has been no ‘buy’ back of these AMC FTDs nor have we seen the company get removed from the NYSE Threshold Securities List.
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.
Last week, AMC Entertainment CEO said he asked FINRA and the NYSE to look closely at their stock due to the amounting FTDs.
“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.”
AMC Stock: SEC violates 13-day threshold list rule.
A buyback of shares in the lit market would result in price action driving share prices up.
In the past month, AMC stock has fallen by nearly -15%.
What are FTDs?
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.
According to Investopedia, AMC failure-to-delivers can also occur if there is a technical problem in the settlement process carried out by the respective parties (clearing houses).
Is the SEC Complicit in Market Injustices?
According to Patrick McConlogue, an ex-Citadel Data Scientist, rules tend to heavily favor hedge funds over the average investor.
Known for exposing Citadel during the ‘meme stock’ frenzy, Patrick says “the game is not fair and it never has been. Individual investors, even when operating in a swarm, are destined to lose. How do I know? I helped design the game.”
Many investors refuse to believe that FINRA or the NYSE will attend to AMC’s CEO Adam Aron in regard to the violation of the 13-day threshold rule.
These institutions have more power than the SEC themselves, how could these rules be enforced?
AMC shareholders are demanding a formal letter from the CEO showing proof of contact with our regulators.
No update since the initial announcement has been made public so far.
Market News Daily: Ex-Citadel employee Patrick McConlogue says the market is rigged.
Patrick McConlogue, an ex-Citadel Data Scientist said during the ‘meme stock’ frenzy that the stock market is rigged, claiming he helped design it.
“The game is not fair and it never has been. Individual investors, even when operating in a swarm, are destined to lose. How do I know? I helped design the game.”
Not many investors know this, but Patrick actually breaks down how Citadel and other hedge funds were able to make billions back in only weeks from halts.
In this article, I’m going to share his words and knowledge in the industry directly with you.
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Ex-Citadel Employee Reveals Rigged Trading Game
Ex-Citadel employee Patrick McConlogue says the market is rigged.
Patrick McConlogue appeared on Fox Business during the ‘meme stock’ frenzy of 2021 when retail investors created one of the biggest scares in Wall Street history.
GameStop and AMC shareholders were able to create panic on Wall Street by heavily buying shares of the overleveraged shorted stocks.
As share prices soared, short sellers experienced massive losses.
GameStop was able to put Melvin Capital out of business, but Patrick McConlogue says other hedge funds were able to make back billions in losses during the halt.
The halts allowed hedge funds to enter AMC and GameStop knowing shares would plummet, allowing them to capitalize on the deflation of the price.
Patrick says the rules of the game also heavily favor hedge funds, something retail investors have urged SEC Chairman Gary Gensler for years to change.
“I respect many of my colleagues, the problem isn’t the people, it’s the rules of the game which heavily favor the funds.”
Below is ex-Citadel Data Scientist Patrick McConlogue’s story.
Patrick McConlogue Says the Stock Market is Rigged
Ex-Citadel employee Patrick McConlogue says the market is rigged.
“The game is not fair and it never has been. Individual investors, even when operating in a swarm, are destined to lose.
How do I know? I helped design the game.
A few years ago, I worked at the massive hedge fund Citadel. The multi-billion dollar fund was caught up in this week’s scandal for bailing out hedge fund Melvin Capital after everyday traders on Robinhood appeared close to liquidating the fund through mass buying of the GameStop stock $GME.
My role at Citadel was as an engineer in Long Term Quantitative Strategies. The entire department, filled with programmers and compliance officers, is dedicated to something called ‘alpha’ which determines the buying strategy of the fund.
I was responsible for innovative proprietary technology that capitalizes on public data faster than any other hedge fund. It’s a classic situation of machines against humans. I respect many of my colleagues, the problem isn’t the people, it’s the rules of the game which heavily favor the funds.
A group of traders on the r/WallStreetBets Reddit thread, now consisting of over 8.6M members, noticed that someone had overly “shorted” the GameStop $GME stock.
They decided it was the perfect time to buy. It was only around $18 per share and easily affordable for the common investor who kept buying, driving up the price of the stock.
As the buying frenzy continued the hedge funds who had taken the opposite position started to hemorrhage money.. BIG money.
The small investors celebrated their success online as news broke that the hedge fund Melvin Capital Management had lost so much on the $GME short position that they had to be bailed out by bigger hedge funds.
While the markets were closed Melvin Capital’s sinking battleship received an emergency infusion of $2.75 billion from Citadel and Point72.”
‘Meme Stock’ Halts
Ex-Citadel employee Patrick McConlogue says the market is rigged.
“On Thursday morning, Robinhood — the commission-free stock trading app used by small investors — suddenly shut down buys on $GME and a few other stocks that were under siege.
Only sell orders went through, reversing the trend, driving the stock prices back down and shoring up the hedge funds’ sinking ships. Remember, when the stock price goes down, the people who hold the “shorts” make money.
This started a chain reaction. Other retail trading platforms like E*Trade and TD AmeriTrade began freezing the stock for individual investors. But hedge funds own supercomputers.
They have direct access to stock markets. While small investors were frozen the hedge funds traded massive positions and quickly earned back the billions in losses from the past few days.
The rules of the game had been exposed, in broad daylight no less.
Robinhood users, when signing up for the popular trading app that offered “free trading” were likely unaware of their role in the hedge funds’ ability to reap huge profits.
The system is broken.”
Patrick McConlogue left Citadel for decentralized finance and co-founded a new technology called Overline that takes the philosophy of DeFi to the extreme.
Not only is Overline unable to freeze any of your assets but it can’t even turn off the exchange; it’s not possible.
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.
According to Investopedia, AMC failure-to-delivers can also occur if there is a technical problem in the settlement process carried out by the respective parties (clearing houses).
Investors say there’s a major conflict of interest when Citadel Clearing LLC processes retail orders worldwide.
Are AMC’s FTDs a result of naked shorting?
Majority of the retail community seems to think so.
Companies are even beginning to take legal action against the predatorial short selling strategy.
GNS CEO Shares Petition to End Naked Shorting
Recently, Genius Group ($GNS) CEO Roger Hamilton shared a petition to end naked shorting in the market.
The Naked Shorts War activist urged the retail community to sign it in efforts to raise awareness of manipulative tactics that occur in the market every day.
“They’re predators. They’re doing something illegal, and we want it to stop”, says GNS CEO Roger Hamilton.
The Board of Directors of Genius Group Limited, a leading entrepreneur edtech and education group, approved at a meeting of the Board held on Wednesday 18th January 2023, an action plan to address illegal short selling of its stock.
AMC shareholders have criticized AMC CEO Adam Aron for not addressing the manipulation in AMC Entertainment stock.
This action plan includes creating a Board-led ‘Illegal Trading Task Force’ to actively pursue all possible actions together with the regulators in their discovery and prosecution of persons engaging in market manipulation involving the ordinary shares of Genius Group.
Waging war against naked shorts is something that won’t succeed so easily, but raising awareness is a sure way to start.
SEC Chairman Gary Gensler has said in the past that FTDs aren’t always the result of naked shares — but that’s as much as he’s mentioned the term.
FTDs can also result in buyers not having the funds to cover costs during execution of a security, though for retail investors this is a very unlikely scenario.
The stock market has seen its fair share of manipulation throughout the decades.
Institutions can spoof the market with ‘naked shares’ to move the price without ever having to take accountability for any real asset.
They can also lend shares they don’t own as IOUs and never have to take accountability when it comes to delivering them but rather simply reporting them as failure-to-delivers.
So, there are certainly loopholes our regulators must take into account.
And as far as the retail community is concerned, our regulators know all too well what’s occurring in the market.
Putting pressure on these regulators could be the first steps towards creating real change in the near future.
Retail investors might just be the ones to make history this decade.
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