Short Squeeze
A situation in which a lack of supply and an excess demand for a traded stock forces the price upward. Investopedia Says:
Short squeezes occur more often in smaller cap stocks with small floats.
If a stock starts to rise rapidly, the trend may continue to escalate because the short sellers will likely want out. For example, say a stock rises 15% in one day, those with short positions may be forced to liquidate and cover their position by purchasing the stock. If enough short sellers buy back the stock, the price is pushed even higher. Related Terms:
Buy Back
Buy To Cover
Days To Cover
Float
Liquidity
Long Squeeze
Short Covering
Short Interest
Short Sale
Short Sale Rule
Short Squeeze
Small Cap |