AMC Theater, Times Square

AMC Fails to Deliver Jump 2700%

Fails to deliver in shares of AMC Entertainment Holdings, Inc. jumped over 2700% in the latest data from the SEC.

After falling to a low level at the end of September, fails to deliver exploded in October. As of October 14th, the last day in the latest data set, they stood at nearly 80,000.

This amount of fails to deliver is 789 times Amazon’s, 849 times Microsoft’s, and significantly larger even than Apple’s. Why would the largest stocks in the market have far fewer shares failing to deliver than AMC, with a market cap of just $20 billion?

First, let’s recap what a fail to deliver is. A share in a company fails to deliver when a trade is made but never completed. The shares are never actually delivered to the buyer.

This can happen for benign reasons. But AMC has persistent, huge fails to deliver.

When that happens, it’s often a sign of illegal naked short selling. This involves selling short shares you never borrowed.

The shares can’t be delivered because they never existed in the first place. Meanwhile, the seller has a powerful tool to the push the price down.

If you don’t even have to bother borrowing shares, you can keep selling forever.

What you tend to see in AMC stock is the market makers whittling down the fails to deliver for a little while, only to see them quickly pop back up to enormous levels. Following the stock for some time now, I’ve seen this pattern over and over.

We’ve noticed, but when will the SEC?

More on markets:

Citadel Demands Dismissal of Lawsuit, Citing SEC Report

Starting a Financial Plan from 0

Citadel Builds Huge Position in AMC Call Options

Raw SEC data (the fails to deliver are the number right before the company name):

20210930|00165C104|AMC|2815|AMC ENTMT HLDGS INC CL A COM S|35.54

20211014|00165C104|AMC|78931|AMC ENTMT HLDGS INC CL A COM S|37.91

20211013|023135106|AMZN|100|AMAZON COM INC;COM USD0.01|3247.33

20211014|037833100|AAPL|58498|APPLE INC;COM NPV|140.91

20211014|594918104|MSFT|93|MICROSOFT CORP;COM USD0.000012|296.31

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8 thoughts on “AMC Fails to Deliver Jump 2700%”

  1. This is a very exaggerated take on the data considering the day to day variation. A more appropriate method would be to use avg daily FTDs divided by the average volume(trade date) for the same FTD settlement period. Or look at the FTDs(settlement date)/Volume(trade date). In this case there is about a 200% increase in FTD(by volume percent) increase for the early Oct period. Additionally, the volume based percentage method shows that AMC is not that far off(of course its not the same being much more volatile and heavily shorted) of AMZN and MSFT. Thanks!

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    1. Interesting idea, but I don’t think that approach would work. Reason is that the SEC doesn’t report day-by-day FTDs, only cumulative FTDs as of a certain date. So, I don’t think comparing those accumulated FTDs to a single day’s volume would tell you very much.

      “The values of total fails-to-deliver shares represent the aggregate net balance of shares that failed to be delivered as of a particular settlement date. ”

      https://www.sec.gov/data/foiadocsfailsdatahtm

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      1. Thank you for engaging with me. I understand the aggregate nature of the data(I’m usually correcting others) and, of course, I considered the same thing myself. But the average method(as well as as a percent of volume) is still a better, imo, method then comparing a single day. Perhaps a FTD %(of volume) moving average would be a better still. I’ll try this myself. An analogy might be that of credit card balance or checking account balance….lots of ups and downs but the overall average over time is what tells you if you’re saving or spending. Maybe a poor analogy but hopefully expresses my perspective.

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      2. I think that type of moving average would be useful. If you put something like that together I’d be happy to excerpt and link to it here. I might myself depending on time constraints. I like the idea!

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  2. Instead focusing on citadel and market makers we should focus on people/politicians who are making this possible by taking money from large institutions and creating loopholes for them so they can operate like we/all of us don’t exist

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