Tag Archives: AMC

Over 43 Million APE Shares Fail to Deliver — Market in Chaos

The market in AMC Entertainment Holdings Preferred Equity (APE) shares is a mess. Fails to deliver (FTDs) peaked at over 43 million shares last month, according to a report just out from the SEC.


Get the blog before anyone else…subscribe!


These new shares were issued last month by AMC and began trading on August 22. FTDs peaked at 43,438,257 shares two days later.

This represents over 8% of all shares outstanding. And it all happened in 3 days!

FTDs like this is beyond a mix-up. It’s a total market meltdown.

FTDs remained elevated through the end of the August reporting period. They settled at 5,635,854 on August 31, the last data available.

Let’s compare the FTDs on August 24th in APE shares with those of some of the biggest stocks in the market:

Amazon: 0

Apple: 395,929

Google: 113

Microsoft: 0

Tesla: 530

APE: 43,438,257

APE shares have dramatically more FTD’s than other, much larger stocks.

FTDs can sometimes happen for benign reasons, like clerical errors. But when there’s a sustained pattern of massive trade failures, it often indicates naked short selling.

This generally illegal practice involves selling short shares without borrowing them first. It’s a powerful way to push down a stock’s price.

If you don’t have to find shares to borrow or pay interest, you can sell short as many shares as you like! All that selling makes a stock’s price crater.

If naked short sellers are targeting APE, so far they seem to be winning. The stock is down 43% since its debut.

The NYSE and SEC must look into this market breakdown immediately. One in three trades failing is not a functional market.

What do you think of the huge FTD numbers in APE shares? Leave a comment at the bottom and let me know!

Have a great weekend everyone!

More on markets:

AMC Fails to Deliver Pass 700,000 in New Report

Hedge Fund Manager’s Arrest Shows How Market Manipulation Works

Morgan Stanley Investigation Spreads to Multiple Countries

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

New Index Will Drive Demand for AMC, Other Meme Stocks

Note: This is not financial advice.

Robinhood Markets is launching a new index fund to track meme stocks. From a report that broke this morning in The Wall Street Journal:


Get the blog before anyone else…subscribe!


Robinhood Markets is launching an index to track the favorite stocks of its millions of predominantly young, social-media-savvy customers.

The brokerage firm’s new “Robinhood Investor Index” will track the performance of the 100 investments most popular among its user base. Initially, the top five stocks in the index will be Tesla , Apple, Amazon.com, Ford Motor and meme-stock favorite AMC Entertainment Holdings. Robinhood said it would update the composition of the index monthly, offering a view into its customers’ changing tastes.

In an unusual approach to constructing an index, Robinhood said it would weight stocks in the index by the “conviction” customers have in them, defined as the percentage of assets in a customer’s portfolio devoted to a particular stock.

The new index will increase demand for meme stocks, especially those weighted heavily like AMC and Tesla.

When a stock is included in an index like the S&P 500 for the first time, the price generally jumps. This is because so many index funds track the S&P 500.

When a stock is added to it, those funds must buy the stock. Similarly, when investors buy shares of the new Robinhood index, Robinhood must buy stocks like Tesla, AMC, etc.

This increases demand for those stocks.

Indeed, a McKinsey study found that stocks added to the S&P 500 jumped a median of 5%. But the increase was short-lived, disappearing in just 20 days on average.

The effect of inclusion in the Robinhood index is likely to be more modest, given that $5.4 trillion tracks the S&P and the Robinhood index is just getting off the ground. Still, I expect a modest tailwind for meme stocks from this change.

The Robinhood index is an interesting approach. It allows investors to profit from the “wisdom of the crowd,” following investors who have strong conviction about particular stocks.

If an investor is confident enough to put their entire portfolio into a single stock, maybe they know something I don’t.

I’ll be curious to see how the Robinhood index does against other index funds. And you can bet every broker is rushing to create a meme index as we speak.

What do you think of Robinhood’s new meme stock index fund? Leave a comment at the bottom and let me know!

Have a great weekend everybody! 👋

More on markets:

AMC Fails to Deliver Pass 700,000 in New Report

Morgan Stanley Investigation Spreads to Multiple Countries

Hedge Fund Manager’s Arrest Shows How Market Manipulation Works

Get the blog before anyone else…subscribe!

Save Money on Stuff I Use:

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

AMC Fails to Deliver Pass 700,000 in New Report

Note: This is not financial advice.

Fails to deliver in shares of AMC Entertainment Holdings hit massive levels this month.

Failed trades peaked at over 700,000 shares, according to a report out this morning from the SEC. They remained in six figure territory for all but two days in the period, which covers the first half of August.


Get the blog before anyone else…subscribe!


This many failed trades is highly unusual for most stocks. Let’s zoom in on August 8th and compare AMC with some of the largest stocks in the market:

Alphabet (Google):: 22

Amazon: 533,744

Apple: 379,843

Microsoft: 0

Tesla: 49,705

AMC: 723,636

Keep in mind, these other companies are dramatically larger. But month after month, little old AMC has far more failed trades.

Fails to deliver can happen for benign reasons, like administrative errors. But why would such errors affect this stock way more than others, time and time again?

The more likely explanation is naked short selling. This involves selling short shares you never actually borrowed.

It’s a powerful weapon to push down a stock’s price.

You don’t have to find any shares to borrow. And you don’t have to pay any interest to borrow them!

This means you can sell short an unlimited number of shares. Awesome, right?

It’s illegal for a hedge fund to do this. But that may not stop them, especially given lax enforcement.

But perhaps the most incredible thing is that 723,636 may understate the number of trades that are failing.

The Depository Trust & Clearing Corporation (DTCC) puts failed trades that don’t resolve for a long period into an “obligation warehouse.” At that point, they essentially disappear.

Earlier this month, over 9 million shares worth of failed trades in AMC stock suddenly vanished.

Maybe the DTCC were busy beavers cleaning it all up. Or maybe they just swept them under the rug.

We won’t know until the DTCC and SEC offer transparency on what happens to failed trades.

Something tells me we’ll be waiting a while.

What do you think of the new SEC report? Leave a comment at the bottom and let me know!

More on markets:

AMC’s 9 Million Missing Shares

Morgan Stanley Investigation Spreads to Multiple Countries

Is Melvin’s Gabe Plotkin Headed to Prison?

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: Melvin Capital founder Gabriel Plotkin

Why Hedge Funds May Pile into APE Shares

Note: This is not financial advice

This morning, new preferred shares of AMC Entertainment Holdings debuted on the New York Stock Exchange.


Get the blog before anyone else…subscribe!


Interestingly, the new shares (ticker symbol APE) have the same ownership interest and rights as normal AMC shares. But as I write this, they trade for $5.80, versus $10.52 for AMC shares.

The shares appear ripe for one of Wall Street’s favorite strategies: arbitrage.

If the two share types have the same economic value, they should trade at the same price. Hedge funds often buy an underpriced security while selling short an equivalent higher priced one.

The bet: the two prices will converge.

I expect hedge funds to buy APE shares while shorting AMC common stock. On paper the strategy makes sense, but there’s a little problem…

AMC shares are heavily shorted. 20% of the float has already been sold short.

If hedge funds continue shorting the stock, they become vulnerable to a short squeeze. Huge run-ups in shares of AMC, GameStop Corp. and others have bankrupted hedge funds before, such as Melvin Capital Management.

What’s more, both AMC and APE shares have passionate fanbases that can cause massive volatility. The human factor could cause a seemingly straightforward pairs trade to go very, very wrong.

Hedge funds should heed the lesson of Melvin Capital and avoid shorting volatile meme stocks. But as Benjamin Franklin said:

“Wise men don’t need advice. Fools won’t take it.”

How do you think hedge funds will react to the debut of APE shares? Leave a comment at the bottom and let me know!

More on markets:

AMC’s 9 Million Missing Shares

Is Melvin’s Gabe Plotkin Headed to Prison?

Wall Street Banks Turn on Each Other as Federal Probe Looms

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

AMC Shorts Take $653 Million Loss in August

It’s been a rough August. And it’s not over.

Short sellers in shares of AMC Entertainment Holdings have lost $653 million so far this month. From a new Bloomberg report:


Get the blog before anyone else…subscribe!


Investors betting against the most well-known meme stocks have lost about $1.65 billion this month after the shares soared in value, prompting a short squeeze.

AMC Entertainment Holdings Inc.’s 47% rally has pushed mark-to-market losses for short-sellers to $653 million, S3 Partners data show. Similar bets against Bed Bath & Beyond Inc. and GameStop Corp., which have surged 359% and 19%, respectively, in August, lost $1 billion combined.

Bets against meme stocks like AMC and GameStop blew up hedge fund Melvin Capital Management, among others. But like moths to the flame, short sellers seem drawn to losing more.

Many firms like Melvin heavily shorted multiple meme stocks. Rallies in several meme names at once multiplies their losses.

Shorting a heavily shorted company is a recipe for a short squeeze. Add a fanatical retail following, and disaster could strike at any moment.

The ideal short sale candidate is a failing company that isn’t heavily shorted. And you want something with no cult following.

Or better yet, follow the counsel of a hedge fund manager I had dinner with recently:

“Short selling is a great way to lose money.”

I guess some are learning. As for the rest, bon chance.

What do you think of short sellers recent losses? Leave a comment at the bottom and let me know!

More on markets:

AMC’s 9 Million Missing Shares

Is Melvin’s Gabe Plotkin Headed to Prison?

Shorts Having Their Worst Month Since January 2021

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Is Melvin’s Gabe Plotkin Headed to Prison?

The SEC is investigating Melvin Capital Management for securities fraud. From a report that broke last night in The Wall Street Journal:


Get the blog before anyone else…subscribe!


The U.S. Securities and Exchange Commission is looking into Melvin Capital Management risk controls and investor disclosure after the hedge fund was crippled by the meme-stock rally last year, said people familiar with the matter.

The regulator has contacted investors in the hedge fund in recent months as part of an investigation into what Melvin founder Gabriel Plotkin and other senior executives told them following the meme-stock rally in January 2021 and whether it misled investors when it raised money last year.

If Plotkin and other top Melvin executives lied to investors in a fundraising presentation, they committed a very serious crime: securities fraud.

Securities fraud can be punishable by prison time, not to mention large fines. Of course, no one has proven anything yet against Plotkin or anyone at Melvin.

When Melvin raised money last year, it had already suffered massive losses. Its losses during the meme stock rally of January 2021 were $6.8 billion, or more than half its assets.

The worst days saw losses of over $1 billion. A day.

If you’re raising funds and fighting for survival in a situation like that, you might be tempted to stretch the truth.

We don’t yet know which fundraising presentations the SEC is looking into. But we do know that Melvin raised $2.75 billion last year from Citadel and Point72 Asset Management.

Did Melvin lie in those presentations in order to secure the bag?

When you rob mom and pop, it’s hard for the victim to fight back. But if you rob some of the richest and most sophisticated investors in the world, they can hire an army of lawyers to make your life very difficult.

This investigation comes on top of a DOJ probe into Melvin’s short sales. That investigation too could result in prison time for insider trading if wrongdoing is found.

In all, it’s not hard to see why Melvin shut down. It had lost a fortune, couldn’t get any more performance fees, and feds were circling.

I don’t know whether Melvin did anything wrong. But I do know that today, I’m glad I’m not Gabe Plotkin.

Do you think Melvin is guilty? Leave a comment at the bottom and let me know.

Have a great weekend everyone! 👋

More on markets:

Melvin Capital Under Federal Investigation

The Real Reasons Melvin Is Shutting Down: No Fat Fees and a Federal Investigation

AMC’s 9 Million Missing Shares

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: Melvin Capital founder Gabriel Plotkin

AMC’s 9 Million Missing Shares

Trading in shares of AMC Entertainment Holdings Inc. just gets stranger and stranger.

A new report from the SEC shows fails to deliver dropped to 205,675 shares in the first half of July, the latest reporting period. This is down from a high of nearly 9.7 million just two weeks ago.


Get the blog before anyone else…subscribe!


So, were exchanges busy little bees cleaning up over 9 million shares worth of failed trades?

Maybe. Or maybe those shares went somewhere else…

The Depository Trust & Clearing Corporation (DTCC) settles most US securities transactions. It has an “obligation warehouse” where it puts failed trades.

Once those failed trades go to the obligation warehouse, they basically cease to exist.

We don’t know for sure if that’s what happened with these 9 million shares because the SEC and DTCC won’t tell us. But given the complexity of settling that many failed trades, I’m willing to bet the DTCC just wiped the slate clean.

So why does this matter?

Allowing huge numbers of trades to fail enables naked short selling. Naked short selling is selling short shares without borrowing them first.

It’s a powerful way to push down a stock’s price. After all, if you don’t have to find shares to borrow, you can short as many shares as you want!

No wonder Compliance Week calls it “one massive embezzlement scheme that for years has mostly gone ignored.”

Why would the DTCC do this? Perhaps because of how it’s funded.

The DTCC makes money by clearing trades and is owned by its users.

Hedge funds are some of its heaviest users.

No wonder the DTCC just sweeps trades under the rug instead of investigating what happened.

The SEC should investigate the pattern of massive fails to deliver in stocks like AMC. And the DTCC must ensure trades are actually completed.

Until then, we’ll continue to see these shenanigans in markets.

What do you think happened to these 9 million shares? Leave a comment at the bottom and let me know!

More on markets:

AMC Fails to Deliver Hit 9.7 Million

How DTCC Makes Fails to Deliver Disappear

Wall Street Banks Turn on Each Other as Federal Probe Looms

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Shorts Having Their Worst Month Since January 2021

Note: This is not financial advice.

Short sellers are having their worst month since January 2021. From a new Bloomberg report:

Somehow, the stock market’s worst first half in five decades has morphed into a slaughterhouse for short sellers.

More big lumps were felt Tuesday, when the S&P 500 rallied 2.8% and bearish traders suffered losses roughly double that.

About 98% of S&P 500 members advanced, the broadest rally since December 2018. The most-hated stocks jumped 5.5%, eventually delivering pain for bears who were forced to cover their positions to limit losses, going by a Goldman Sachs Group Inc. basket. With the most-shorted basket up 16% in July, the month is shaping up to be the worst for short sellers since the retail-driven squeeze in January 2021.


Get the blog before anyone else…subscribe!


Heavily shorted stocks have not run like this since meme stocks skyrocketed last January. Indeed, meme stocks are causing some of the biggest pain for shorts right now.

This tussle between the two sides of the investment world has continued this year, and fresh data from S3 Partners, LLC shows that between January and July 2022, AMC short sellers lost more than $1 billion in mark to market losses.

We’re in a bear market. This is not a great time to bet that stocks will go lower.

But hedge funds have piled in anyhow, betting against volatile stocks with cult followings. And again, they’ve taken major losses.

Perhaps some in the hedge fund world are beginning to learn their lesson. I had dinner with a bunch of hedge fund guys last month, and one said:

“Short selling is a great way to lose money.”

Now, short selling hedge funds may be forced to buy stock. They cannot fall too far behind their benchmarks.

Again from Bloomberg:

“Positioning had gotten very defensive as managers were anticipating additional downside. However, if the market rallies, then they are at risk of underperforming the broader market,” Freeman said. “Shorts are hurting their performance and they don’t have enough long exposure to keep up so they are forced to buy.”

Short sellers being forced to buy stocks to stem losses…this is the definition of a short squeeze.

I certainly don’t know if or when any stock will squeeze. But I do know I wouldn’t want to be on the other side of these trades.

What do you think is next for short sellers? Leave a comment at the bottom and let me know!

More on markets:

AMC Fails to Deliver Hit 9.7 Million

Wall Street Banks Turn on Each Other as Federal Probe Looms

New Law Could Put Big Short Sellers on the Endangered Species List

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order.

Photo: “the Great Hedge Fund Hei$t” by eyewashdesign: A. Golden is licensed under CC BY-NC-ND 2.0.

AMC Fails to Deliver Hit 9.7 Million

In over a year reporting on this, I’ve never seen a number this big.

Fails to deliver in shares of AMC Entertainment Holdings Inc. hit nearly 9.7 million in June. The report, released today by the SEC, covers the second half of the month.


Get the blog before anyone else…subscribe!


The peak came on June 28, with 9,697,393 shares failing to clear. Fails to deliver settled at a still massive 1,907,897 at the end of the month.

So what are fails to deliver, anyway? A fail to deliver occurs when a trade is made but never completed.

Let’s say I agree to sell you 100 shares of AMC for $15.07 each. You want the shares and you’re happy with the price, so you agree.

Done deal right? Wrong.

I have to actually deliver the shares to you. When I fail to do that, that’s called a fail to deliver.

Fails to deliver often occur when traders engage in naked short selling. This generally illegal practice involves selling short shares without borrowing them first.

It’s a powerful way to push down a share’s price. If you can sell stock short without borrowing any, you can short any amount!

The market is flooded with sell orders and the share price dives. But the trades never get completed.

Instead, they show up on this report.

This is a truly incredible number of failed trades. Let’s zoom in on June 28th, the peak for fails to deliver.

Here’s how many fails to deliver some of the biggest stocks in the market had that day. This can give us an idea of what’s normal, even for far larger companies:

Alphabet Inc. (Google): 814

Apple Inc.: 28,223

Microsoft Corp.: 12,400

The biggest companies on earth have just a few trades not clearing. Meanwhile little old AMC has nearly 10 million.

Keep in mind, just because those fails to deliver dropped near the end of the month doesn’t mean the trades ever settled. The DTCC often puts trades that failed some time ago into an “obligation warehouse.”

After that, these failed trades disappear.

How can we have robust financial markets when the public doesn’t trust them? And how can the public trust markets when trades that affect share prices never actually happen?

It’s time for the SEC to investigate this issue vigorously.

Until then, we’ll just see more bogus trades pile up.

What do you think is causing these failed trades? Leave a comment at the bottom and let me know.

Have a great weekend everyone! 👋

More on markets:

Wall Street Banks Turn on Each Other as Federal Probe Looms

New Law Could Put Big Short Sellers on the Endangered Species List

Bill Ackman Loses $4.8 Billion

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Reddit/Twitter/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

New Law Could Put Big Short Sellers on the Endangered Species List

A new law introduced in Congress could mean the end of some major short sellers. According to a report that broke this morning on TheStreet, the law would require disclosure of short positions by large investors.

Today, big investors like hedge funds have to disclose the stocks they own quarterly. But they can keep secret any short position they have, no matter how large.


Get the blog before anyone else…subscribe!


If the bill passes, those days are over. From TheStreet:

The Short Sale Transparency and Market Fairness Act will modify the reporting requirements applicable to certain institutional investment managers who have more than $100 million in assets under custody and who are required to file ownership reports with the SEC. Key modifications include:

1 Reducing the reporting window from 45 days to 10 days after the end of each month for such asset managers.
2 Expanding such reports to require reporting of direct or indirect derivative positions or interests (including short positions).

This could make it dangerous for hedge funds to heavily short a stock. Soon, everyone would know about their position.

That means other hedge funds could buy the same stock to engineer a short squeeze. They may be joined by retail investors, as was the case in shares of GameStop Corp. and AMC Entertainment Holdings Inc. last year.

A short squeeze can cause catastrophic losses for a hedge fund, as in the case of Melvin Capital.

The new law could also make naked short selling more difficult. This generally illegal practice involves selling short shares without borrowing them first.

I’ve long suspected naked shorting in shares of meme stocks like AMC and GameStop, along with many other investors.

But what if regulators or the public could count up the amount of short positions out there? If big investors have far more shares short than exist, it would be strong evidence of naked short selling.

In all, I think this bill would be a very positive change for markets. If investors have a right to know about long positions held by big institutions, why not short positions?

What’s more, in a future financial crisis, knowing who shorted what could be critical. A huge short position that blows up could push an institution to insolvency, perhaps dragging others with it.

We don’t know yet whether the bill will pass or what final form it might take. But here’s hoping Congress acts to make markets safer, fairer, and more transparent.

What do you think about the new bill? Leave a comment at the bottom and let me know!

More on markets:

AMC Fails to Deliver Pass 2.6 Million in New Report

Hedge Fund Tiger Global Losing $136 Million a Day, Down 52%

$6B Hedge Fund Cut Off from Trading As Investigation Looms

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Reddit/Twitter/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “U.S. Capitol building” by Gage Skidmore is licensed under CC BY-SA 2.0.