Of AMC’s publicly traded shares, about 18% had been sold short Wednesday, according to S3 Partners.
When prices start to rise, inflicting losses on short sellers, they often buy back borrowed shares they had sold, fueling further gains. Shares ofĪnd other so-called meme stocks also swung sharply Thursday.ĪMC’s recent leap likely was amplified by the significant amount of stock that had been sold short by investors seeking to benefit from a decline in the company’s share price. Individual investors who flocked to the company when it was in distress last year, not heeding the warnings of finance professionals, are poised to make big gains.ĭespite the rockiness in AMC’s shares, the influence of online traders on the stock market showed no sign of abating. Hertz suspended the sale after the SEC said it had questions about the deal, but the firm is emerging from chapter 11 after institutional investors won a contest to buy it out of bankruptcy. In bankruptcy at the time, the car-rental company hoped to capitalize on strong demand from individual investors while warning that the bankruptcy process could wipe out shareholders. Plan to sell as much as $500 million in shares last summer. It added that its share price might continue to experience extreme volatility that could cause losses for investors who buy the stock.
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