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Short squeeze of long term stock holding

Personal Finance & Money Asked on March 27, 2021

Does 50 % of the float being short indicate a short squeeze ? The stock also went up 25% today at the maximum , normally it is an inactive dividend play which is what I wanted. I put in a short at 10% gain on the day. Generally , what action is recommended if you are in an unintentional short squeeze ?

One Answer

The size of the float being short does not indicate that a short squeeze is occurring.

Before you can consider today's price move to be a short squeeze, you have to scan the news to see if there is a fundamental reason causing today's price move (earning release, analyst recommendation, etc.).

Determining whether it's a short squeeze or not is irrelevant to your action. Your risk management should be based on price not labels.

Correct answer by Bob Baerker on March 27, 2021

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