Buying AMC put contracts.
As a meme stock AMC is both volatile and vulnerable to a sharp decline. Fundamentally, it’s very difficult to justify the company’s $17 billion market cap and as the stock starts to move lower we could see retail traders quickly throw in the towel.
The stock broke down last week and after a half-hearted rebound, it appears AMC is ready to build momentum as shares fall lower.
Meanwhile, our speculative strategy offers some protection if shares move against us thanks to residual volatility premiums that will keep some value in our put contracts. A move back below $20 for shares of AMC would leave this position with significant profits.
- Buy (to open) 16 AMC January 21st $35 Puts
- Limit $9.10 or less
- The new position will represent roughly 9.2% of our Spec Model capital
- 15:54 Executed
- Bot 16 AMC Jan 21st $35 Puts @ $9.10