AMC Options Traders Can't Stop, Won't Stop

AMC Entertainment Holdings, Inc. (AMC) was trading up almost 7% higher at one point on Friday amid continued retail interest in the stock. The company has been a target of a second short squeeze that, unlike in January when the stock’s meteoric rise and fall lasted only about eight trading days, is lasting much longer.

Movie Projector, Projector, Presentation


AMC hit an all-time high of $72.62 on June 2, rising almost 500% from its May 24 opening price of $12.17. Following the squeeze, AMC retraced 45% to $39.75 but has since shot back up toward its record high. The stock is popular within Reddit communities due to its underlying statistics:

  • The stock has a short interest of 22.85% which means 102.3 million of its total 448.56 million share float is held short. Notably, the short interest has risen by 14.75 million more than on April 30.
  • There is also speculation that naked shorting is occurring heavily on AMC’s stock and if the naked shorts are required to cover, the stock could rocket further.
  • Institutions also seem to be a fan of the stock and have repeatedly purchased call contracts, throughout the past two weeks, on the stock. On Friday morning, the flurry of activity continued with options traders throwing over $3.02 million into AMC calls.

Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price. A sweeper pays market price for the call option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of call option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

The AMC Entertainment Option Trades: Below is a look at the notable options alerts, courtesy of Benzinga Pro:

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