Arrival SA ARVL shares are up over 11% in Wednesday's pre-market regular session after closing nearly 6% higher in the regular session a day prior. The surge comes in the aftermath of a post on Reddit investor forum r/WallStreetBets discussed short positions in the electric vehicle company.
What Happened: The post by user Trancify pointed out that there are 9.62 million registered shares shorted while Arrival has a float of 51.7 million.
Trancify noted that the 9.62 million shorted number did not include Failure to Delivers (FTD) or “Naked Shorts”, which the poster said amounted to 1 million shares — citing Fintel data.
Further, the post pointed out the discrepancy between the number of shares available for shorting and the actual number shorted.
Why It Matters: The poster hinted that someone has been buying or shorting 14,000 Arrival contracts per day and the open interest is reset each day implying the options are being exercised.
See Also: Arrival Teams Up With Uber To Make An Electric Vehicle Specifically For Ride-Hailing
“Short interest on $ARVL is massive, and interested parties seem to be betting on a PIPE unlock soon. They are paying over 100% for their borrow fee and could be forced to cover if the stock gains upward momentum. They appear to be manipulating the price and buying time through options contracts,” the post stated.
WallStreetBets is best-known for short squeezes in stocks like GameStop Corp GME and AMC Entertainment Holdings Inc AMC.
On Tuesday, Arrival attracted 133 mentions on WallStreetBets. At press time, the most discussed names were Clean Energy Fuels Corp CLNE, AMC, and ContextLogic Inc WISH.
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