AMC is Now Designated by NYSE as a ‘Threshold Security’
Tim Fries, 29 June 2021
The more one zooms into the stock market’s underpinnings, the more surreal it gets. Today, the NYSE has designated AMC as a ‘threshold security’, shining further light onto the situation with AMC shares that fail to deliver.
MOASS Revisited
Yesterday, the Tokenist reported on another tie-in to the great short squeeze saga. Both TD Ameritrade and Schwab brokers announced their increased margin trading requirements to reduce the risk for themselves and for traders who wish to engage in the trading of the two mega-shorted stocks – GME and AMC. As these stocks already drained $12 billion from hedge funds, all market players are fortifying their financial walls.
From multiple House hearings addressing short selling and faster settlement times, to DTCC, OCC, and NSCC changing their rules, these moves serve as bricks to wall off what is popularly dubbed as MOASS (Mother of All Short Squeezes). While (covered) short selling is part and parcel of the US stock market, the MOASS relies on a couple of key ingredients to represent an anomaly:
Purported naked short selling: Short selling stock shares that haven’t been registered as borrowed. Instead, they puff into existence as derivatives. In turn, this increases the volume of tradable shares visible to brokerage app users as regular stocks.
Scale of the naked short selling.
