If a serious investor was asked вЂњShould I buy meme stocks?вЂќ a few months ago, the obvious answer would have been no. The usual victims/beneficiaries of such events are the so-called вЂmeme stocksвЂ™, like GameStop and AMC, which have been boosted by massive popularity on Reddit and fintwit, leading to masses of retail investors and traders buying up swathes of their stock.ДЄMC stock, and other companies popular on RedditвЂ™s WallStreetBets, have been rising, often in quadruple digits, over the past six months. The condition plays out as a significant measure of the short sellers coincidentally decide to cut losses and exit their positions.вЂќ The short squeeze begins when the price jumps higher unexpectedly. For a short squeeze to occur theВ security must have an unusual degree of short-sellers holding positions in it. вЂњA short squeeze is an unusual condition that triggers rapidly rising prices in a stock or other tradeable security. This is what is known as a short-squeeze. Therefore, when retail investors drove the stock price up over the last few months, many hedge funds had to cover their losses which resulted in the stock skyrocketing. Investors believed that AMC stock would fall given that cinemas were forced to close during the pandemic. Short selling is basically betting against a stock. That leaves us asking the question, were these gains justified or are such stocks caught up in massive short-squeezes?Д«ut, before we get into what happened to these stocksвЂ¦ вЂ¦what exactly does short selling mean? This year, shares of AMC Entertainment (NYSE: AMC), GameStop (NYSE: GME), and more have soared on seemingly unqualified metrics.

Amc squeeze potential