I'm pretty sure AMC is going to hit crazy prices in a couple of weeks to months. A Korean AI traded fund just dumped Facebook and Wallmart for AMC. Plus, I got in a pretty big fight with some multimillionaire shorting the stock, after joking about selling each share for $2 mil each. I have no idea how high the gamma squeeze will be if it comes, nor how to calculate the volatility of it for exiting at the right time.
AMC keeps getting added to the Threshold Security List, and eventually it's going to stay on there for 13 consecutive days, and force all of those shorts to close. I think they're getting emotional and have way doubled down on buying shares that do not exist. Would make sense for normal stocks; but, everyone buying AMC doesn't care about any fundamentals. Just the short term effect of there being more shorts than available to buy. I do think this could be a profitable company depending on how the Apes play this post spike.
What I've figured out so far is I want to use a percentage based trailing stop loss to maximize profits, while minimizing risks. When the event happens it's definitely going to be a sellers market, and ask seems like the right price to base the volatility percentage on. I heard you want to toss a multiplier in too. Don't know if I need one for gamma squeeze. Everything I've read was using more long term volatility indicators, and I don't believe those apply for a gamma squeeze.
I found a bunch of formulas for calculating gamma here. But, I'm not sure which to use per say for this stock, and I don't know how many data points should be collected the day of. I don't believe dividends should matter with the sudden spike. AMC has not paid dividends since 03/06/2020 either. Are any of these formulas right at all for this situation?
This is clearly something skilled day traders know. All of the investors I know do not mess with day trading. This includes very wealthy traders, and they could not help me on this. How do I calculate gamma accurately enough once the price starts spiking up crazy? Where would I find all of the data needed?