Meme stocks are on the comeback trail after giving retail investors a cause for worry this week. Shares of AMC Entertainment are up about 13% today following a rocky week in which the stock fell from its perch of USD 55 to below USD 50. Now it is racing toward the USD 50 threshold once again.
Investors are shaking off the week with a Twitter campaign that is catching on called hashtag “AMC Party.” Their happy mood seems to be spilling over to the stock headed into the weekend, with shares of AMC seeing green along with its meme stock peers.
In particular, the Reddit investor crowd seems to be focused on June 18 for call option expirations. In early June, traders reportedly poured more than USD 11 billion into AMC-related options contracts. One trader who goes by “MartyParty” on Twitter and who has amassed more than 21K followers said he “bought another AMC call option for June 18 USD 243.”
The meme stock crowd has been growing lately with some new names. AMC remains one of the most promising, however, for the WallStreetBets crowd from which it got its fame. According to fintech company S3 Partners, the movie chain has boasted what’s known as a “squeeze score” of 10 out of 10.
In fact, the firm revised its model from a range of 1-10 to a range of 1-100. Even with this wider scale, AMC alongside GameStop and Clover Health all score 100. By way of comparison, Tesla stock has a squeeze score of 23 out of 100. In dollar terms, AMC stock has short interest of USD 3.4 billion attached, according to S3 Partners’ Ihor Dusaniwsky.
Individual investors are looking to put the squeeze on sophisticated traders like hedge funds. They have already been quite successful, costing hedge funds billions of dollars in losses this year in market rallies led by the likes of AMC and fellow meme stock leader GameStop.
Now retail investors are hoping for a chance to amplify their gains further with a short squeeze at the traders’ expense. In this case, the traders, who are betting on the stock’s decline, would have to cover their short positions by buying shares of the stock. This is the Holy Grail for the WallStreetBets Reddit crowd.
This article was originally posted on FX Empire
More From FXEMPIRE:
European Equities: A Week in Review – 11/06/21
The Weekly Wrap – Monetary Policy and Economic Data Accompanied Market Optimism
Crude Oil Weekly Price Forecast – Crude Oil Continues to Reach Higher Levels
S&P 500 Weekly Price Forecast – S&P 500 Continues to Show Buyers on Dips
Natural Gas Weekly Price Forecast – Natural Gas Pressuring Resistance
AMC Party Trends on Twitter, Stock Inches Closer to USD 50