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AMC Stock Rises After Report of Hedge Fund Going Short

Odey Asset Management reportedly shorted AMC stock. The retail investors in meme stocks like AMC often buy stocks that hedge funds short.
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AMC Entertainment  (AMC) - Get AMC Entertainment Holdings, Inc. Class A Report shares rose Thursday after a report that hedge-fund firm Odey Asset Management shorted the movie theater chain’s stock.

Retail investors in meme stocks like AMC often go on buying binges of stocks that hedge funds short. Short sales are bets that stock prices will fall.

Odey, the London manager of about $4.1 billion, established the position “recently,” according to investor letters seen by the Financial Times, the paper reported. Odey bought AMC in portfolios run by James Hanbury.

AMC recently traded up 10% near $33 and has more than quadrupled over the past six months.

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But the stock is one of Hanbury's biggest winners, the letter said. AMC has dropped 40% over the past month.

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Retail-investor purchases and other factors have “created some major distortions” and some “compelling short opportunities” in the market, Odey said in its letter. The firm declined to comment to the FT.

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TheStreet.com Founder Jim Cramer mentioned AMC in a tweet Thursday.

“To be helpful to my Wall Street Bets fans: make choices today: RobinHood and $AMD v. $GME and $AMC.. as i question your firepower.. I wonder if your helpful mentions to me will keep all four in the air. As always Jimmy Chill thanks you for all of your help,” he said.

Cramer told Action Alerts PLUS senior analyst Jeff Marks that AMC was topping his list due to the theater chain's earnings report due Monday.

"AMC is the one in the fulcrum of worry," Cramer said.

The original meme stock, GameStop  (GME) - Get GameStop Corp. Class A Report, recently traded at $152.78, up 4%.