AMC’s short borrow fee has risen to 103.30%.
This is the fee short sellers are paying annually to borrow short shares in efforts to suppress the stock’s share price from creating a short squeeze.
Short sellers could face serious losses as the movie theatre chain stock begins to move up in price again from retail buying pressure.
As hedge funds begin to play the long game and begin to buy the stock again, the reality for the short seller could be disastrous.
In 2021, AMC shareholders were able to move AMC’s share price from $2 per share to $20, and then from $9 per share to its all-time high of $72 per share based on momentum alone.
AMC retested the heavy demand zone at $6 per share and even retested above the $8 level.
However, share prices have broken below these levels going into the new year.
Here’s is the latest AMC news and updates.
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AMC’s Rising Share Price Spells Trouble for Short Sellers
Retail investors continue to take on Wall Street in 2023 as long-term shareholders continue to buy and hold the world’s largest movie theatre chain stock.
#AMCSTOCK and #AMCSQUEEZE have been trending on Twitter for two years in a row now, signifying shareholders aren’t leaving.
After price rejection at $6 levels, AMC finds itself trading above $7 per share having retested $8.32 in the past two week.
AMC’s short interest is already over 22% according to Fintel, the same short interest it was before it began surging to its all-time high.
Retail investors have been waiting for AMC to trade above $100 per share since last year when it almost went up to those levels.
But with the extremely high short borrow fee rate, shareholders are preparing to see the stock’s price skyrocket again.
Short sellers betting against the movie theatre chain are no longer paying the 1% short borrow fee rate like earlier this year.
According to Stonk-O-Tracker, hedge funds are currently facing a 103.30% short borrow fee rate to short AMC.
Also Read: How to Buy AMC Stock (2023 Guide)
It’s Getting Riskier to Short AMC
Experts are claiming that a recession could extend market volatility until around fall of 2023.
As the markets begin to hit the bottom, it poses greater risk to investors going short on the market.
At some point, the market has to come back up.
Many may face unprecedented losses hoping the markets will keep dropping when in fact we may experience a bounce.
Bull markets also tend to last a lot longer than bear markets which means all of this draw-down has only been temporary.
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