A short sale squeeze occurs when there are many short sale positions on a stock the stock begins to increase. As the stock price rises, the short sellers scramble to cover their short positions, i.e., buying the stock they have sold back. This creates demand for the stock above that which caused the stock price to start rising in the first place, and can lead to rapid price appreciation.
Archives
Whisper Number
Analysts publish earnings forecasts for companies they follow. Sometimes analysts publish a lower number than they really believe to reduce chances of a negative surprise, but they supposedly “whisper” what they really think to their best friends. Most whisper numbers you see on the Web are simply the analysts’ consensus forecasts plus the average of the most recent two or three earnings surprises.
Anonymous Trading
Permits Participating Organizations to voluntarily withhold their true broker identities when entering orders and trades on TSX trading systems.
Mid-Cap
Company with market capitalization between $2 billion and $7 billion.
Short Selling
The selling of a security that the seller does not own (naked or uncovered short) or has borrowed (covered short). Short selling is a trading strategy. Short sellers assume the risk that they will be able to buy the stock at a lower price, cover the outstanding short, and realize a profit from the difference.
Working Capital
Current assets minus current liabilities.
Ask or Offer
The lowest price at which someone is willing to sell the security. When combined with the bid price information, it forms the basis of a stock quote.
Minimum Fill Order
A special term order with a minimum fill condition will only begin to trade if its first fill has the required minimum number of shares. For example, an order to buy 5,000 shares with a minimum volume of 2,000 shares can only trade if 2,000 or more shares become available.
Short Squeeze
A sharp move up in stock price forcing short sellers to liquidate their positions.
Write
To write an option is to sell an option. The person who sells the option is considered to be the writer.