AMC Short Sellers Recover $1 Billion In Little Over A Week – With Confusing Data

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Short sellers betting against AMC Entetainment, Inc have managed to recover a substantial portion of their losses over the course of the previous week. AMC and GameStop Corporation became the center of a tussle between retail and institutional investors earlier this year after the former united to purchase the companies' shares in bulk to create an upward momentum in the share prices.

This resulted in the institutional hedge funds taking heavy losses since they had placed their bets expecting the share price to drop. These bets, collectively known as short selling, have been a source of controversy in the market and fresh data reveals that the short sellers recovered losses exceeding $300 million dollars over the course of this week and more than $1 billion since the end of the second week of the month.

GameStop, AMC Short Sellers Recover Losses At $20 Million/day – But Is It Enough? 

AMC Short Seller Year To Date Losses Stand At Lowest Point During September

The data, which comes courtesy of S3 Partners, LLC, reveals that during midday trading on Friday, year to date losses of AMC short sellers stood at $3.74 billion. While a substantially large figure, when compared to data from earlier this month, it is clear that the short sellers have recovered a substantially large portion of these losses.

For instance, the losses stood at $4.19 billion at the start of this month, after AMC's share price, which opened at $37.02 at the start of the month increased significantly by 27% during the month to close at $47.13 on August 31.

However, as compared to the smooth sailing in August, the shares continued to fluctuate in September, which resulted in the losses increasing by roughly $560 million during the first two weeks to stand at $4.76 billion by the close of trading on September 14th. By this time, the short interest shares stood at 97 million according to S3, by eight million from the end of August.

Latest data from S3 Partners, LLC reveals that the short sellers have managed to recover roughly $1 billion in losses since mid-September to Friday this week. Image S3 Partners, LLC

The latest data, which notes down the year to date losses for the short sellers by the end of trading yesterday, reveals that these losses stood at $3.76 billion. When compared to the losses by the end of the second week of this month, the institutional investors have managed to recover more than $1 billion of their losses over the course of the last week. This is despite the fact that AMC's share price when compared to the start of this month, is still down by $7.12 or 15%.

Interestingly, the nature of the data for the short interest shares, which represent the total share sold short on the market is confounding. The retail camp has alleged that most of the short share sales take place in a manner invisible to retail exchanges, and discrepancies in data shared by S3 and data aggregation platform Ortex add further mystery to the matter.

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For instance, while S3 lists down the short interest shares at 87 million, data from Ortex shows that they stand at 97 million, representing roughly one fifth of the total free floating AMC shares.  Additionally, while S3 lists down the borrow fees for AMC at 1.2%, another aggregator, Fintel, lists it down as 0.83%.

All in all, even though the institutional camp reverses some of their gains despite a share price drop this month, AMC's shares have appreciated by a staggering 266% over the course of the last six months, making sure that the retail traders have made their mark.

The author has no position in any of the stocks mentioned. WCCF TECH INC has a disclosure and ethics policy.
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