If you’re reading this, chances are you hold AMC stock.
AMC is up more than 65% from exactly one year ago but down 41% this new year.
But retail investors continue to hold AMC stock.
The reasons vary – but I’d like to touch topic on this incredibly rare market phenomena we’re seeing here with this community.
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“Buy and Hold” skyrocketed AMC to $72 per share
And “buy and hold” will skyrocket it past a new ATH.
The concept has been simple from the very beginning, right?
Retail investors buy the stock to drive momentum and hold AMC stock to essentially refrain the price from dropping.
The aftermath would be even bigger momentum caused by short sellers closing their positions.
Well, the concept hasn’t changed today – the only difference is we’re stuck in a bear market.
Now, the biggest CEOs in America don’t think this bear market will linger, but it’s a different situation here than it was last year.
This year apes holding AMC stock will have to ride the bear wave and let the markets do some purging.
AMC’s trading volume has been below average but remains healthy in the tens of millions.
Apes are not just holding the stock this year; they’re continuously buying it too.
Investors are asking, “will AMC go back up?”
You would have expected AMC’s negative beta of -43.0% to hold the stock relatively well during this bear market.
However, institutions continue to borrow millions of shares every day to short the stock, as seen on Stonk-O-Tracker.
Perhaps now that margin requirements have been raised by 25%, we’ll begin to see some deleveraging soon.
And in turn, see some suppression get lifted on heavily shorted stock.
I’ve gone over a number of times how AMC’s current short interest shows us the movie theatre chain is not done running.
You will know AMC is no longer a short squeeze play when the short interest plummets to the ground.
It’s currently at a high 19%.
It’s not a matter of asking whether AMC will go back up but rather when will it go back up?
Like the entire market, AMC Entertainment is only one of many public companies also stuck in this bear market.
A reversal will happen just as quick or just as long as it takes for bull sentiment to re-enter the market.
So, how long are ‘apes’ willing to hold AMC stock?
Apes are willing to hold AMC stock as long as it takes for shorts to close their positions.
But how high are apes willing to hold the stock?
I personally think it will vary from person to person as everyone has different profit goals.
This is why it’s been relatively important for investors to meet a number of shares goal.
The number of shares you hold is actually a multiplier that will play a big role in how much money you make in AMC stock (or any other stock).
If your share goal was 1,000 shares, then you will earn $1,000 for every dollar that AMC goes up.
From here you can determine when to take profits on AMC depending on your conviction of how high AMC will go.
Everyone’s number of shares goal will differ, but this is just an example.
Regulators have not held institutions accountable for synthetics yet, and for this reason I feel it’s best to play it safe and bulk up on shares (not financial advice) to increase that multiplier.
The last thing you want to do is believe in some absurd numbers, leaving you out of making a life-changing play.
Leave your thoughts below
Realistically, how high are you willing to hold AMC stock?
We know there’s going to be a bigger runup than the first two this third time around.
Will this be MOASS?
Who knows – but we’ll have to keep an eye out on exactly how much short interest goes down to determine just how much juice is left.
Feel free to leave your thoughts down in the comment section below.