President Joe Biden has recently implemented Executive order 14032 to replace Donald Trump’s Executive order 13959. Based upon the previous history of the original executive order in relation to AMC stock price increasing, we are here to merely speculate what could potentially happen with the replacement executive order from Biden.
WHAT WAS EXECUTIVE ORDER 13959?
Previously, Trumps executive order 13959 was put in place and prohibited financial institutions to use Chinese securities as collateral. The original executive order implemented by Trump mean that margin calls increased, as financial institutions were no longer to able use their Chinese securities as collateral. In January of 2021, we saw the AMC stock price increase rapidly when Chinese Securities were temporarily prohibited as collateral, and when the executive order was again moved to May of 2021, we saw the AMC stock price surge again to about $72 per share.
EXECUTIVE ORDER 14032?
On June 2nd, 2021 financial institutions were given back the ability to use the Chinese securities as collateral again for a period of 365 days. In just a few weeks, that 365 day period will be up and now retail investors are speculating on what this could mean for the AMC stock price next month. With the start of Executive order 14032, it will again prohibit financial institutions from using Chinese securities as collateral and based off of the previous time this occurred in 2021, we saw AMC stock price rapidly increase as it created a large amount of margin calls.
Although it’s no guarantee that history will repeat itself, retail investors are anticipating that the executive order may cause a surge in the AMC stock price again. As always, it’s important for retail investors to keep an eye on all catalyst for the AMC share price. This includes AMC’s short interest data. AMC’s current short interest is at 21.57%. Last year when AMC increased to nearly $72 per share, short interest went from 15% to 20%.
In addition to Biden’s Executive order 14032, we also know that financial institutions and hedge funds like Tiger Global and Melvin Capital have been in financial turmoil for a long time. Tiger Global was burned on their GME short positions last year and suffered millions in losses. Investors speculate that it could be possible that these large Hedge Funds are in more financial trouble that they even lead on, which could again be yet another catalyst for the AMC stock price from margin calls, short positions closures or other financial turmoil.