Throughout the year, shares in AMC Entertainment Holdings, Inc. have had huge fails to deliver. The most recent SEC data, just released today, is no exception.
AMC fails to deliver were 39,976 times those of Amazon.com, Inc. Amazon, with a market cap of $1.7 trillion, is more than 85 times AMC’s size.
Looking at other large stocks, the pattern is similar. AMC’s fails to deliver are 36 times Apple’s, 25 times Exxon Mobil’s and 1199 times Facebook’s.
Fails to deliver occur when a trade is made that is never completed. When there’s a long term pattern of large fails to deliver, it’s often indicative of naked short sales.
This generally illegal practice involves selling shares short without ever borrowing them. The trade never completes because the shares never existed in the first place.
Since you don’t need to borrow any actual stock, you can keep putting in sell orders indefinitely. That artificially drives the price down.
AMC’s fails to deliver go up and down with time. But, they remain consistently far greater than those of much larger stocks.
I strongly suspect hedge funds who have lost substantial sums shorting AMC stock are conducting illegal naked short sales to try to rescue themselves.
When will the SEC act on its own data?
More on markets:
AMC Has Burned Short Sellers for $4 Billion in 2021, Per Latest Data
Will Evergrande Spark a Global Financial Crisis?
AMC Shares 50% More Likely to be Traded in Dark Pools
Raw SEC data
The most recent data set ends on September 14th. The fails to deliver is the number right before the company name:
20210914|00165C104|AMC|119929|AMC ENTMT HLDGS INC CL A COM S|51.69
20210914|023135106|AMZN|3|AMAZON COM INC;COM USD0.01|3457.17
20210914|037833100|AAPL|3320|APPLE INC;COM NPV|149.55
20210914|30231G102|XOM|4873|EXXON MOBIL CORPORATION|55.37
20210914|30303M102|FB|100|FACEBOOK INC CL A COM STK (DE)|376.51
Photo: “CMI 101: Demystifying Derivatives with CFTC Chairman Gary Gensler” by Third Way is licensed under CC BY-NC-ND 2.0
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