Tag: Finance News (Page 1 of 14)

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GameStop announces 4-1 stock split

GameStop Corp. on Wednesday said its board approved and declared a four-for-one split.

It’s the first time GameStop has split the stock since 2007 making it the second time in history it happened.

GameStop had done a 2-1 stock split thirteen years ago.

So, what does a 4-1 stock split even mean?

It means that current GME shareholders will receive 4 shares of GME stock for every one share they currently hold.

If you’re holding 1 share of GameStop in your stock portfolio, you will receive 4 shares of GME stock.

Shareholders with 1,000 shares of GME stock will receive 4,000 shares.

However, this does not mean GameStop’s share price will quadruple in the process.

On the contrary, GameStop’s current share price will be divided by four.

The stock closed at $117.43 on Wednesday and has jumped more than 8% after hours.

What will GameStop shares be worth after the stock split?

Based on Wednesday’s number figure, GME stock will be worth approximately $29.35 after the split, making the stock much more affordable for the public to invest in.

GameStop stock split date

Investors who purchase GME stock before July 18 will receive the additional shares in GameStop’s 4-1 stock split.

Some investors might wonder, why is GameStop splitting its stock?

Often times when a stock’s share price has reached high levels, a company will issue a stock split to make it more affordable for the public to purchase.

We’ve seen this happen with Tesla (TSLA) and Apple (AAPL) in the past.

Amazon recently had a 20-1 stock split, making it extremely affordable to add AMZN stock to your portfolio.

Stock splits are a common way to attract more investors towards a growing company.

Are you a GME shareholder?

How many shares of GME stock will you own after the stock split?

Or are you a curious investor who is thinking of buying GME after the stock splits at a much more affordable price?

And lastly, will GameStop’s 4-1 stock split be a catalyst to finally squeeze short sellers from their positions?

I’d love to hear your thoughts.

Leave a comment down below.

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Chicago Tribune Says Citadel Securities’ Dark Pool Targets Small Investors

July 5, 2022 / Frank Nez / 7 Comments

Market News: Citadel Securities Dark Pools Exposed — Market News: Citadel Securities Dark Pools exposed

The Chicago Tribune just 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 now brought these nefarious practices in the market to light.

Let’s discuss it.

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Taking down Citadel’s dark pool

The Chicago Tribune has acknowledged investors’ orders almost never make it to the New York Stock Exchange (NYSE) or NASDAQ.

The editorial team say they get redirected to electronic platforms run by private market makers who match buyers with sellers at a price they determine, behind closed doors.

Citadel Securities’ dark pool is able to make money on the difference between bid and ask prices when trades are matched.

This creates major conflict of interest as the orders they fill are not competing against one another; therefore, the price is open for manipulation.

SEC Chairman Gary Gensler said himself 90% to 95% or retail’s orders do not get processed through the lit exchange.

And although light is shining on this very real problem, nothing is being done about it by our regulators yet.

“The U.S. Securities and Exchange Commission is responsible for revising its rules to keep up with technology and, here’s a surprise, the regulators have fallen behind.” – The Chicago Tribune.

But the editor says the problem is the SEC has too much on their hands and are spreading themselves thin.

They’re focused on crypto regulation, SPACs, and climate control.

It’s rather clear dark pools are not the SEC’s main priority.

Citadel Scandal

Citadel has been heavily scrutinized by retail investors for not only heavily shorting ‘meme stocks’, but for suppressing the price driven by retail demand with its dark pool.

#KenGriffinLied began trending on Twitter earlier this year and again this month when the U.S. House Committee on Financial Services released a report confirming Robinhood and Citadel did indeed have blunt negotiations prior to trading restrictions on January 28th of 2021.

The “GameStopped” report documents in detail the events that lead to the halting of ‘meme stocks’.

Ken Griffin swore under oath that Citadel and Robinhood had no communication the day prior to the restrictions, but proof has now surfaced.

The question now is, will the case dismissed by Judge Cecilia Altonaga late last year get reopened?

The 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.

According to Business Insider, the court said that the evidence between Citadel Securities and Robinhood was not sufficient.

The retail community found Judge Cecilia Altonaga had ties to the defendant in the Robinhood and Citadel case, creating a major conflict of interest.

But mainstream media isn’t covering this.

What can be done about this corruption in the market?

If you’ve been one of my day-ones, you know I’ve always preached raising awareness.

Raising awareness is what gets people to learn, dive deep, and stand against market injustices.

People want to fight for a cause, people want to fight for freedom.

Instead of focusing on the things that are out of our control (SEC, market manipulation, etc.), we must focus on the things that are in our control.

And that is raising awareness to educate the population.

I truly believe this is the way to creating real change.

If this resonates with you, please be sure to give this article a social share.

It all starts with us, one by one, as individuals.

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Thank you for being a reader.

– Frank Nez

Can AMC Stock Reach $100? Market News and Updates

July 4, 2022 / Frank Nez / 8 Comments

Market News: Can AMC stock reach $100? — Market News: Can AMC Stock reach $100?

Investors want to know; can AMC stock reach $100 per share?

Last year AMC’s share price skyrocketed to an all-time high of $72 per share.

Retail investors were able to trigger this price surge when a few short sellers decided to close their short positions.

AMC’s short interest percentage during that time dropped from 23% to 20%, and then to 14%.

AMC Entertainment was barely recovering during this time.

Today, the company is stronger than ever before.

Here’s what we know.

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Comparing AMC this year to last year

Can AMC stock hit $100 per share?

AMC is no longer the same company it was last year.

So much has changed ever since the retail community armed the century old movie theatre chain with more than a billion dollars in liquidity.

AMC repaid $45 million of deferred rent reducing their balance to approximately $272 million in Q1 of 2022.

The company plans to reduce the deferred rent by another $125 million by the end of this year.

CFO Sean Goodman announced that AMC seated 39 million guests in Q1 alone this year; it had seated 7 million guests in Q1 of 2021.

A whopping 32 million difference.

AMC Entertainment earned $785.7 million in revenue this first quarter, more than five times the revenue in Q1 of 2021 ($148.3m).

The company also ended Q1 with $1.4 billion in liquidity.

Quick updates

Financial reports suggest AMC is on a road to financial recovery from the impact of Covid-19.
AMC’s Perfectly Popcorn business is on schedule to enter the retail game later this year.
The company is currently doing product testing, research, and looking at new concepts.
AMC says the launch of an AMC credit card is going to be a lucrative business opportunity for the company.
8 different NFT programs have been launched or are in the works of being launched so far, further fueling movie ticket sales.

AMC Entertainment is a stronger company fundamentally today.

Its innovation with crypto and NFTs are going to propel not just the business forward, but its share price in the long-term future too.

Related: Cinemark Competes with AMC in New NFT Deal with Disney

AMC stock almost reached $100 per share when it surged to $72 last year during the month of June.

The stock price was only at $14 when it began to uptrend.

AMC traded at $13.53 on Friday though it’s been hovering below and at $14 in the past week.

Can AMC stock reach $100 per share?

Of course it can.

But the process will require retail investors to be patient.

Whether fundamentals play a role in it or not, AMC only needs a few short sellers to close their positions in order to make this share price level come to fruition.

You can keep an eye out on the reported short interest here (updated daily).

Is there anything you would like to add?

Leave a comment down below.

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Related: Here's How Shareholders Can Trigger an AMC Short Squeeze

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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.

Your dedicated support combats corporate media such as The Fool, MarketWatch, and Yahoo Finance, through news with integrity.

Thank you for being a reader.

– Frank Nez

Robinhood and Citadel Colluded Night Before Trading Restrictions

July 2, 2022 / Frank Nez / 26 Comments

Citadel and Robinhood Colluded — Market News: Robinhood and Citadel colluded before ‘meme stock’ restrictions

The U.S. House Committee on Financial Services just published a press release stating Robinhood and Citadel Securities engaged in ‘blunt’ negotiations before the trading of ‘meme stocks’ occurred.

The press release states that talks regarding lowering PFOF (payment for order flow) rates happened just a night before trading restrictions.

Robinhood and Citadel GameStopped Report — GameStopped Report Notes

The “GameStopped” report issued by the U.S. House Committee on Financial Services greatly details how the NSCC saved Robinhood from defaulting due to failing to meet collateral obligations.

This article is going to highlight key points relating to the ‘meme stock’ halts that occurred in late January of 2021.

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Let’s dive right into it!

You can view the full detailed report here.

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GameStopped report

The GameStopped report highlights Robinhood’s lack of liquidity, conversations between Citadel and Robinhood, and the process leading to the halting of ‘meme stocks’ such as AMC and GameStop.

On January 28th, 2021, Robinhood routed orders to six market makers for equities: Citadel Securities, G1 Execution Services, Morgan Stanley, Two Sigma Securities, Virtu, and Wolverine.

Citadel, Morgan Stanley, and Wolverine are short on AMC to this day.

The conversations between Robinhood and Citadel were tense as the two negotiated the price of PFOF rebate rates and price caps for AMC and GameStop.

Furthermore, Robinhood received a massive waiver of its deposit requirement from the DTCC.

And according to the report, without this waiver, Robinhood would have defaulted on its regulatory collateral obligations.

NSCC officials say the waiver was necessary to avoid systemic risk to the market.

They explained that the extraordinary spike in ‘meme stocks’ contributed to increased clearing fund requirements for several firms.

Trading Restrictions Chart - GameStopped — Trading Restrictions Chart – GameStopped

Brokers halted the buying of AMC, GameStop, and other tickers when short sellers began to close their short positions, causing share prices to skyrocket.

The halting occurred due to a lack of liquidity where certain brokers were unable to cover the minimum collateral requirements.

The DTCC waived a total of $9.7 billion of collateral deposit requirements on January 28, 2021.

Retail feels cheated

GameStop - GameStopped — Robinhood and Citadel colluded prior to restrictions

Retail investors feel they were robbed when brokers took away the ‘buy’ button by restricting trading in AMC, GameStop, and other ‘meme stocks’.

The DTCC jumped in and saved Robinhood from defaulting, cut Citadel’s losses short, and prevented retail investors bets from reaching maximum potential.

No one has been held accountable for these actions primarily because the system is justifying the actions as saving the market from total collapse.

But the system stole from retail investors to save institutional investors.

Regulators intervened to save institutions while they capped retail investor gains.

Still, hedge funds lost billions of dollars during the process.

GameStop broke Melvin Capital.

The hedge fund was not able to recover from its massive losses and has now shut down.

But Citadel nor Robinhood have faced any severe consequences that money can’t buy them out from.

Retail investors are now looking at our government and regulators as complicit to fraud and market manipulation.

What are your thoughts on the incidents that occurred during this time?

Leave a comment down below.

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Related: Can AMC Stock Reach $100? Market News and Updates

Read how much those are worth here.

Cinemark Competes with AMC in New NFT Deal

June 30, 2022 / Frank Nez / 3 Comments

Cinemark Competes with AMC in new Thor Love and Thunder NFT Deal with Disney — Business News: Cinemark Competes with AMC in new Thor: Love and Thunder NFT Deal with Disney

Cinemark is looking to compete with AMC Entertainment theatres in a new NFT deal it just made with Disney.

From Tuesday, June 28th, through Thursday, July 7th, rewards members will get a chance to win one of 1,000 NFTs for Marvel Studios’ upcoming Thor: Love and Thunder.

AMC Entertainment was the first company to release NFTs (non-fungible tokens) to their movie theatre guests upon the purchase of a ticket.

The largest movie theatre chain in the world has released a Spider Man No Way Home NFT, Jurassic World NFT, The Batman NFT, Lightyear NFT, and many more.

Shareholders also received a rare series one “I Own AMC” NFT.

Here’s the latest market news.

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Cinemark teams up with Disney

“Cinemark is thrilled to collaborate with Disney on the release of these exclusive Marvel Studios NFTs for Thor: Love and Thunder,” said Wanda Gierhart Fearing, Cinemark Chief Marketing and Content Officer. – Box Office Pro.

The movie theatre industry has been steadily recovering ever since the pandemic struck the world in 2020.

Cinemark Holdings, Inc.’s total revenues for Q1 2022 increased by 303% to $460.5 million compared to $114.4 million for Q1 of 2021.

AMC Entertainment on the other hand earned $785.7 million in revenue during their first quarter of 2022, compared to $148.3 million in Q1 of 2021.

Cinemark’s marketing campaign to distribute Thor: Love and Thunder NFTs with Disney is a great move for the company.

However, AMC Entertainment continues to be the leader in the movie theatre industry, offering a more premium experience to its guests.

What are your thoughts on Cinemark competing with AMC Entertainment in the NFT space?

Leave a comment down below.

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Related: Will AMC Stock Go Up? [2022 Deep Dive]

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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.

Your dedicated support combats corporate media such as The Fool, MarketWatch, and Yahoo Finance, through news with integrity.

Thank you for being a reader.

– Frank Nez

Why is AMC’s Short Interest Going Down?

June 30, 2022 / Frank Nez / 1 Comment

AMC’s short interest has gone down from 23% to 19.42% with very little noticeable change in the share price.

Shareholders are wondering why AMC’s SI has dropped and price has not risen.

After all, isn’t AMC’s share price supposed to skyrocket as the short interest goes down?

Let’s discuss it.

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Let’s dive right into it!

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Short interest drops

AMC’s short interest has dropped from 23% to 19.42% in a matter of days.

AMC Entertainment stock moved from a low of $11.60 to a high of $14.36 on the 5-day chart.

While we have officially entered a bear market, not even positive news can escape the clutches of the general market’s downtrend.

So, is it possible this very small short interest drop could have been responsible for AMC’s small climb from $11.60 to $14.36?

AMC’s shares on loan also dropped from 194 million to 163.31 million.

But should shareholders holding out for a short squeeze be worried?

After all, it’s AMC’s short interest that tells us AMC has a shot to reach a new all-time high, isn’t it?

AMC’s short interest has always fluctuated, despite being on an uptrend for months now.

If AMC’s short interest keeps falling down, then we can anticipate shorts have merely begun to close their short positions.

And as Charles Payne put it, it’s short squeeze season again.

$AMC Oof 🔥 https://t.co/0Iunr6aHAJ
— Frank Nez 🇺🇸 (@FNez_Blogger) June 28, 2022

Will AMC’s short interest keep rising?

Because AMC’s short interest tends to fluctuate, it’s very possible AMC’s short interest rises to +23% again.

This simply means more shorts are getting back in to short AMC at its current market value.

The rise in short interest is primarily independent to institutional sentiment.

We know AMC’s fundamentals have greatly improved.

Could institutions finally be getting ready to close their short positions in AMC Entertainment stock?

It wouldn’t be surprising if they were.

AMC Entertainment Holdings Inc. is no longer a screaming short.

Institutions have lost billions of dollars betting against the century old movie theatre chain for over a year now.

One of the biggest rules in trading is to never trade against the trend, and AMC is no longer a short.

Shareholders will have to keep an eye out on the reported short interest data for insight as to how much runway AMC has to rise in share price.

I update AMC’s short interest daily here straight from Ortex.

One thing is certain

AMC’s share price is destined to rise.

Whether you look at it from a fundamental standpoint or from the perspective of a short squeeze play, a reversal is imminent.

It’s merely a matter of time.

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Related: Will the Apes Successfully Take Down Wall Street Again?

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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.

Your dedicated support combats corporate media such as The Fool, MarketWatch, and Yahoo Finance, through news with integrity.

Thank you for being a reader.

– Frank Nez

Is a Big Power Move Underway for AMC Stock?

June 27, 2022 / Frank Nez / 3 Comments

Market News: AMC Stock Update + more. — Market News: AMC stock update + more.

AMC stock finished up +13.31% on Monday, closing the trading day at $14.13.

The movie theatre chain is now up more than 10% in the past week, breaking even on the monthly chart.

The $14 range is a very nostalgic price range for AMC shareholders.

This is the level where shorts began to close small positions last year, sending AMC’s share price to an all-time high of $72 per share.

Coincidently, AMC’s short interest was at 23% during this time; it’s at 22.42% today.

Is a big power move underway for AMC Entertainment stock?

Let’s discuss it.

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AMC theatres breaks record

AMC Top Gun: Maverick — Top Gun: Maverick – AMC theatre stock – movie theatre chain breaks records

AMC movie theatres as a business has improved its fundamentals drastically.

The company has reduced most of its debt, continues to innovate in itself, and is experimenting with companies outside the industry.

The century old movie theatre chain has certainly shocked Wall Street, and it continues to do so with the exploding revenue due to new movie releases.

Top Gun: Maverick has claimed the title for the highest box office of 2022 so far, earning over $1bn in revenue globally.

The highest previous earner was Doctor Strange in the Multiverse of Madness, earning over $800m worldwide.

Elvis brought in $31m during its opening weekend alone, going head-to-head with Top Gun’s $30m now on its 5th weekend.

AMC Entertainment Holdings, Inc. reported that their market share had remarkably grown from 22% to 26% going into the second quarter this year.

The company has managed to increase the revenue per guest and increase its food and beverage sales this new year.

Fundamentally, the company is showing promising results.

List of movies coming to AMC

Highly anticipated films that are coming to AMC Entertainment theatres include:

Thor 4: Love and Thunder
Bullet Train
Fantastic Beasts: The Secrets of Dumbledore
Halloween Ends
Black Adam
The Flash
Black Panther: Wakanda Forever
Avatar 2
+ more

These are films movie lovers want to watch at the movie theatres, not at home.

This list of incredible films coming out this year are AMC’s arsenal against hedge funds betting against the movie theatre industry, but more specifically against AMC stock.

Will AMC stock price go up?

will AMC stock go up? — Market News: AMC Movie Theaters – AMC stock News

AMC stock will go up due to business demand and due to the company having a strong shareholder base that continues to buy and hold the stock.

AMC Entertainment is an American company that’s a part of our culture’s history.

It’s also the number one leading theatre chain company in the world owning approximately 10,562 screens in the United States alone.

In Q1 of 2022, AMC seated more than 39 million guests, a 32 million difference from Q1 of 2021.

AMC Entertainment also earned $785.7 million in revenue during the first quarter, more than five times the revenue in Q1 of 2021 ($148.3m).

The theatre chain ended Q1 with $1.4 billion in liquidity.

CEO Adam Aron hinted Q2 is on track for another groundbreaking quarter for the company.

Are you an AMC shareholder?

What are you looking forward to the most during this journey?

Is it the recovery process, the awesome movie titles, fighting for market transparency, MOASS?

Or all of the above?

Leave a comment down below.

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Read Market News

Related: AMC's Cost to Borrow Has Hedge Funds Burning Money

AMC’s Cost to Borrow Has Hedge Funds Burning Money

June 27, 2022 / Frank Nez / 16 Comments

AMC Cost to borrow — Market News: AMC’s cost to borrow increases

AMC’s cost to borrow continues to rise.

In the past, we’ve seen how important this data has been regarding major price runup.

Not only does a high cost to borrow incentivize short sellers to close their positions, but it gets AMC one step closer to a squeezing.

In this article I’m going to break down the number figures and explain why the CTB and other data is pointing AMC in the right direction.

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Cost To Borrow explained

The cost to borrow is the average annualized percent (%) of interest on loans hedge funds have to pay.

For example:

AMC has approximately 190.44 million shares on loan as of the publication of this article.

Hedge funds are paying 15.55% annually on these loans.

This translates to $29.6 million per year, or $2.46 million per month.

In the meantime, it’s costing retail investors $0 to hold their positions in AMC stock.

Hedge funds will continue to pay more as AMC’s cost to borrow rises.

Short interest

AMC’s current short interest is: 22.41%.

This is the percent of a company’s free float that is shorted.

AMC is a short squeeze play because of this number figure.

This number figures tells retail investors that there is a high interest in shorting the company stock.

It’s this data that allowed retail investors to foresee big price moves in January and in June of 2021.

This same data tells investors today that AMC has the potential to hit another all-time high.

Some of you might be familiar with the correlations between short interest and rise to $72 per share last year.

AMC’s short interest dropped from 23% to 20%, then to 14% when it ultimately skyrocketed in price from $14 per share to $72 per share.

Despite what mainstream media has said in the past, no, AMC’s short interest is not too low to squeeze shorts from their positions.

Will AMC’s cost to borrow force shorts to close?

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 most of its 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.

Do you own AMC stock?

Are you an AMC shareholder or are thinking about buying AMC stock?

Who is The DTCC and What Are Their Legal Duties?

June 25, 2022 / Frank Nez / 8 Comments

Market News: DTCC — Market News: Who is the DTCC?

Retail investors have pulled up some information on the DTCC regarding the blockage of margin calls.

The Reddit community is calling the organization corrupt.

But what exactly is the DTCC and how do they play an important role in our markets?

In this article I’m going to explain the duties of this corporation in simple terms and also touch topic on questions retail investors might have when it comes to AMC and GameStop.

Let’s get started.

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Who is the DTCC?

The DTCC (Depositary Trust and Clearing Corporation) is an American post-trade financial services company providing clearing and settlement services to the financial markets.

The DTCC processes trillions of dollars of securities on a daily basis.

As the centralized clearinghouse for various exchanges and equity platforms, the DTCC settles transactions between buyers and sellers of securities.

The information is recorded by its subsidiary, the NSCC.

After the NSCC has processed and recorded a trade, they provide a report to the brokers and financial professionals involved.

This report includes their net securities positions after the trade and the money that is due to be settled between the two parties.

Conflict of interest

Clearing corporations such as the DTCC may receive cash from a buyer and securities or futures contracts from a seller.

The clearing corporation then manages the exchange and collects a fee for this service.

The size of the fee is dependent on the size of the transaction, the level of service required, and the type of security being traded.

Investors who make several transactions in a day can generate significant fees.

This means every naked share that has been created on the ‘short side’ has been recorded and bypassed by the DTCC/NSCC, all for a fee.

And this is where retail investors begin to question the integrity of the financial market.

One of the DTCC’s bigger partners is Bloomberg LP, a privately held media and software company.

Retail investors are weary about Bloomberg due to having a dark pool where institutions can make unregulated trades.

Bloomberg also happens to be a media platform where Citadel’s Ken Griffin is made to feel at home.

The short seller remains to this date one of the top 10 institutions shorting AMC stock.

Related: Wall Street Journal is Indirectly Owned by Citadel's Ken Griffin

DTCC removing margin calls

There is information going around in the retail community of the DTCC removing margin calls and it’s creating somewhat of fear, uncertainty, and doubt.

After digging around for a while, it’s important to note that the DTCC did indeed remove margin calls, but on January 28th of 2021.

This isn’t necessarily occurring right this moment.

A press released was published advising of the circumstances that occurred during the time ‘meme stocks’ were halted.

The DTCC waived $9.7 billion of collateral deposit requirement on January 28th, 2021, limiting institutional losses and limiting retail profits.

Could the DTCC have been playing the middleman to prevent the market from completely collapsing?

Or was this blatant market manipulation?

The organization allowed several naked shares to flood the market but never stepped in to level the playfield for retail investors.

So why step in to minimize institutional losses?

I think it’s safe to say those client fees really make things happen.

The SEC is by law responsible for regulating the DTCC, but the DTCC is a company who caters to a wide range of institutions in the financial market.

And according to the SEC Chairman Gary Gensler, they need whistleblowers to really tackle the issues at hand.

Is the DTCC corrupt?

Most retail investors openly think so.

The corporation is a business that processes orders between buyers and sellers but caters to financial institutions – not retail investors.

The DTCC along with the NSCC are very well aware of the naked shorting issue in our market.

But they’ve failed to put a halt to it.

One can view this negligence as being complicit.

I’m curious to learn what you think.

Leave your thoughts in the comment section of the blog down below.

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Short Sellers Are Now Paying More to Short AMC Stock

June 24, 2022 / Frank Nez / 11 Comments

AMC’s short borrow fee is rising again and short sellers are now paying more to short AMC stock.

This is the fee short sellers pay to borrow and short the stock.

It fell as low as 0.30% earlier this year but has now risen to 18.60%.

Although the short borrow fee is still relatively low, the progression could lead to more impactful losses.

Last year hedge funds lost billions betting against the world’s largest movie theatre chain.

Overleveraged positions with high short borrow fee rates only multiplied losses.

Rising short borrow fees could incentivize short sellers to completely ditch the play and close their short positions as shorting becomes more expensive.

Let’s break it down together.

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Let’s dive right into it!

AMC’s Short Interest Data Updated Daily Here

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AMC’s short borrow fee increases

AMC’s short borrow fee rate has steadily been increasing as the markets have tanked.

It comes as no surprise that the fee to short AMC stock would increase during this liquidity crisis.

The SPY officially hit bear market territory two weeks ago, but the market bounced rather quickly, trading just above bear market levels.

AMC continues to be one of the heaviest shorted stocks in the market.

It wiped billions of dollars from hedge funds shorting it last year.

And with a high short interest of 22.52%, AMC has more than enough juice to squeeze shorts from their positions.

But AMC’s short borrow fee rate and short interest percentage aren’t the only metrics increasing.

Pressure is escalating as AMC’s shares on loan reach an all-time high.

Pressure escalates as AMC’s shares on loan skyrocket

AMC’s current shares on loan have reached 185 million.

These shares on loan eventually have to be returned to the lender by buying back the stock in the lit market (NYSE).

The massive buying pressure is going to create a high demand for the stock.

As the demand for the security goes up, so does the cost to buy it (the value of the security).

When AMC surged to $72 per share in June, it had roughly just over 100 million shares on loan and a short interest of 24% before falling to 20%, then 14%.

Today, AMC’s shares on loan have hit 191 million with a high short interest of 22.52%.

Short sellers owe their lenders more now than they did when AMC shot up to $72 last June.

No matter what the catalyst is, AMC is inevitably going to surge again.

Related: Pressure Escalates as AMC's Shares on Loan Skyrocket

Will AMC’s increasing borrow fee rate force shorts to close positions?

AMC’s increasing short borrow fee rate may certainly incentivize short sellers to close their short positions.

The stock is slowly becoming harder to short and the cost to borrow it might prove to not be worth risking significant losses as the market adjusts itself for a reversal.

At some point, it’s going to be time to start betting long.

As you can tell, short sellers have the biggest risk here.

One simple bull rally can eliminate short sellers’ portfolios.

And with the SPY showing significant strength in the $400 level, one can assume the markets have potentially found a bottom.

The SPY momentarily hit official bear market levels last week but has managed to trade just above it.

A significant break upwards could bring the entire markets back up, hurting short sellers.

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Related: These Two Signs Will Tell You a Short Squeeze is Over