LogFAQs > #967360901

Let's talk about something that isn't BBIG for once

AMC.

So AMC has an APE dividend. 8/19 is ex-dividend, 8/22 is distribution date. What it's going to do is reduce the value of AMC shares, and give shareholders a share of APE at a 1:1 rate.

I think the blueprint for how this is going to play out has already been tested by BBIG's Tyde dividend, where the value of Tyde was shredded before every broker was even able to distribute it and it was hard to buy/sell otherwise for some time. APE as a preferred share isn't even buyable with a lot of brokers. Who cares if you've got naked shorts, just "have trouble distributing the shares" and recycle the same ones to everyone as people panic sell when the price implodes.

You can see that they may very well be preparing for this at this moment. Why is the market running right now? Well here's how I theorize the plan of attack.

1. Run AMC up as you cover some of the shares at a cheaper level, hope some people chase as the stock moves. This happened last week when AMC ran from 15 to 25
2. Hold AMC in place as you run other stocks you're shorting to free up margin-- you can't let AMC run too hard otherwise you get margin calls, so it's being strategically frozen in the mid 20s. AMC holders are "dumb money" and still HODLING for their APE shares so you don't have to risk too much retail getting in the way of you covering. This is currently happening.
3. On the distribution date, use all the margin you've recovered from freeing up pressure on other stocks and covering some of AMC to short the hell out of APE and AMC on two fronts. APE is going to be hard to buy and a bunch of people won't even get it, so it's basically a free short. Continue to cover on other stocks to apply more pressure as needed. If AMC holders chase on the other stocks, great, you can cover your shorts on AMC easier in a week or two. If they don't, you cover your shorts on other stocks easier right now.

My plan.

But 8/26 or 9/3 PUTS that are far out of the money on 8/19. I'm talking like around 50% of the stock price. Premiums will be super low.

Flip the puts when the price implodes early next week. I'm thinking AMC will be at like $6 and APE will be at like $3 before 8/26, assuming the price stays around 25 through end of week.

Observe if other shorted stocks and the market as a whole is going up or not. If they are, buy AMC as it is likely AMC holders are continuing to hold and it's going to supernova in a few months. If they're not, buy... I dunno, DNN or FUBO or something. *shrug

We'll see. The other possibility is that the APE dividend will do what it's supposed to and expose naked shorting and make the stock go nuts, but as I literally just saw this fail in BBIG I'm not going to bet on that. I do think EVENTUALLY it'll achieve that goal in both stocks, but not for a few months. Just too many dumb tools they have to suppress prices.