Wednesday, January 27, 2021

5 Low Priced Short Squeeze Stocks

 by Fred Fuld III

Unless you haven’t paid any attention to financial news at all, you probably already know that GameStop (GME) has gone up over 700% in the last five days. The movie theater chain, AMC (AMC) was available for a little over two bucks ten days ago. Today, it traded for 25.80 this morning in pre-market trading.

You also probably know that these huge gains have been caused by short squeezes.  Back on September 18 last year, I published an article called Top Restaurant Short Squeeze Stocks, and it listed four companies that were heavily shorted. In just the last four months, those stocks have had stellar returns.

The worst performing stock was up 38%. Not a bad return for four months. The best performing was Dave & Busters (PLAY), which was up 138%. Here are those four stocks, with the percent of float shorted at the time, the days to cover at the time, and the return if you had bought the stock back then and sold today.

StockSymbol% of FloatDays to Cover% Gain
Shake ShackSHAK26%5.785%
Dave & Buster’sPLAY33%1.8136%
Red RobinRRGB35%3.464%
El Pollo LocoLOCO19%11.238%

Many of the heavily shorted stocks you have seen on the news during the last couple days are high priced, with a majority of them trading over $100 a share. That’s a lot of risk. So If you are looking for low priced stocks that might be short squeeze plays, I will cover that shortly.

But first, a review about the short squeeze and its terminology. When you short a stock, it means that your goal is to make money from a drop in the price of a stock. Technically, what happens is that you borrow shares of a stock, sell those shares, then buy back those shares at a hopefully lower price so that those shares can be returned. This all happens electronically, so you don’t actually see all the borrowing and returning of shares; it just shows up on your screen as a negative number of shares.

Short selling can be profitable, but sometimes when the stock moves against the short sellers, and begins to rise, the short sellers jump in right away to buy shares to cover their positions, creating what is called a short squeeze. When a short squeeze takes place, it can cause the share prices to increase fast and furiously. Any good news can trigger the short squeeze.

Some traders utilize this situation by looking for stocks to buy that may have a potential short squeeze. Here is what a short squeeze trader should take into consideration:

Short Percentage of Float ~ The float is the number of freely tradable shares and the short percentage is the number of shares held short divided by the float. Amounts over 10% to 20% are considered high and potential short squeeze plays.

Short Ratio / Days to Cover / Short Interest Ratio -This is probably the most important metric when looking for short squeeze trades, no matter what you call it. This is the number of days it would take the short sellers to cover their position based on the average daily volume of shares traded. This is a significant ratio as it shows how “stuck” the short sellers are when they want to buy in their shares without driving up the price too much. Unfortunately for the shortsellers, the longer the number of days to cover, the bigger and longer the squeeze.

Short Percentage Increase ~ This is the percentage increase in in the number of short sellers from the previous month.

Check out the following list, but be aware, that often some stocks are heavily shorted for a reason. All these stocks have significant short metrics.

StockSymbol% of FloatDays to CoverStock Price
AyroAYRO23.28%0.517.24
Clovis OncologyCLVS42.43%6.547.94
SenseonicsSENS30.95%1.362.51
TherapeuticsMDTXMD28.89%14.301.59
VBI VaccinesVBIV25.64%6.623.15

So as an example, VBI Vaccines has over 25% of the float shorted, and it will take over six days for the short sellers to cover their positions, based on the average daily volume.

Obviously, there is no guarantee that these stocks will go up, but if I was short any stock selling for less than $10 a share, I wouldn’t want to waste any time covering my position, before all the other short sellers clamor in and drive the price way up.

Disclosure: Author owns TXMD. No recommendations are express or implied.

Saturday, December 19, 2020

Book Gifts: Day Trading, Swing Trading, Investing, Scams, Wall Street History, Real Estate

  by Fred Fuld III

There are only several more days until Christmas, and you are probably looking for that last minute gift for a relative or a friend. Why not give a present of an investment or business book?

Here are some examples that you may want to consider, broken down by category.

Stock Trading & Investing Books

These books are all about either day trading, swing trading, or investing in stocks.

Beat The Crowd: How You Can Out-Invest The Herd By Thinking Differently by Ken Fisher

Investment Guide by Gary Charles Palmer

Unleash Your Investments by John Hagensen

Stock Traders Almanac by Jeffrey A. Hirsch(every stock trader should have this book)

Day Trading Journal Wall Street News Network

Stock Trading Journal Wall Street News Network

How to Day Trade for a Living: A Beginners Guide to Trading Tools and Tactics, Money Management by Andrew Aziz

How to Make Money in Stocks: A Winning System in Good Times and Bad by William J. O’Neil

Stock Trading: THE BIBLE This Book Includes: The beginners Guide + The Crash Course + The Best Techniques + Tips and Tricks + The Advanced Guide Immediate Cash With Stock Trading by Samuel Rees

A Beginner’s Guide To Day Trading Online 2nd Edition by Toni Turner

The 1 Hour Trade: Make Money With One Simple Strategy, One Hour Daily by Brian P Anderson

Investment Trivia by Fred Fuld III

Trade Like Warren Buffett by James Altucher. Most people don’t realize that not only is Warren Buffett an investor, but he is also a trader, and a successful one at that.

High-Probability Trade Setups: A Chartists Guide to Real-Time Trading by Timothy Knight. How to use technical approaches to find the best stock trade setups.

Think & Trade Like a Champion: The Secrets, Rules & Blunt Truths of a Stock Market Wizard by Mark Minervini. The book covers personal trading rules and the secret techniques that made the author one of America’s most successful stock traders.

Trading in the Zone: Master the Market with Confidence, Discipline, and a Winning Attitude by Mark Douglas. Learn the reasons for lack of consistency and how to overcome the ingrained mental habits that cost money.

Wall Street News Network Day Trading Journal: Notebook Diary Log for your Stock, ETF, and Option Trades by Wall Street News Network. A journal with over 100 pages of specially designed fill-in-the-blank pages to track all your stock, ETF, and option trades, whether they are long or short trades. Fields include: Date, Symbol, Company, Transaction Recommended By, Why decision was made to do this transaction, Buy or Short, # of Shares, Price/share, Commission, Subtotal of opening transactions, Total opening transaction, and much more.

Wall Street News Network Stock Trading Journal: Notebook Diary Log for tracking your stocks, options, and ETFs trades by Wall Street News Network. A logbook for tracking your stock trades and investments, priced at less than $7.

Option Volatility and Pricing: Advanced Trading Strategies and Techniques, 2nd Edition by Sheldon Natenberg. An extensive guide to trading stock options.

Swing Trading with Options: How to Trade Big Trends for Big Profits by Ivaylo Ivanov. Using stock momentum to generate profits on options over a three to six month time period.

Penny Stock Trading Journal: Notebook Diary Tracker of Your Penny Stock Transactions by Borsa Valori. A five star rated book designed for you to keep track of your penny stock trades and transactions.

Warren Buffett Books

Here are his recommended books about himself.

Berkshire Beyond Buffett: The Enduring Value of Values

Berkshire Hathaway Letters to Shareholders

50 Years of Berkshire Hathaway Wall PrintThis is actually a wall print poster.

Buffet: The Making of an American Capitalist

Buffett’s Bites: The Essential Investor’s Guide to Warren Buffett’s Shareholder Letters

Historical Books About Wall Street

Reminiscences of a Stock Operator – first published in 1923 by Edwin Lefevre. This is the classic book on investing, trading, market timing, and crowd psychology, just as true today as it was almost a century ago. It is based on the life of top notorious trader, Jesse Livermore.

My Adventures with Your Money – first published in 1911 by George Graham Rice. About a conman who make money off the early gold mining stock boom.

The PLUNGERS and the PEACOCKS. 150 years of Wall Street – published in 1967 by Dana L. Thomas. Written during the bull market of the 1960s, it provides an entertaining history of the stock market.

Den of Thieves – published in 1991 by James B. Stewart. The “newest” of these old books, it covers the insider trading scandals involving Ivan Boesky, Michael Milken, and other Wall Street financiers during the 1980s.

Storming The Magic Kingdom – published in 1987 by John Taylor. A must read book about the fight for control of one of America’s most famous companies.

Extraordinary Popular Delusions and the Madness of Crowds (1841) by Charles Mackay included as part of Stock Market Trivia Volume 2 (2014) The Extraordinary Popular Delusions book was written in the mid-1800s. It has many chapters, but most are unrelated to investing, such as alchemy, witches, haunted houses, etc. However, three of the chapters have extensive and entertaining information about three of the largest investment bubbles in history: the Mississippi Scheme, the South Sea Bubble, and the Tulip Mania. These three chapters are included as the last half of the Stock Market Trivia Volume 2 book. (In interest of full disclosure, I wrote the Stock Market Trivia 2 book.) In addition, the trivia book includes such things as the chocolate chip cookie/stock market correlation, celebrity stock indices, weird stock certificates, and more.

Books About Investment Scams

Wolf of Wall Street Books

The Wolf of Wall Street by Jordan Belfort. This is the autobiographical story about the guy who made hundreds of millions of dollars by pumping and dumping low priced and penny stocks. The book is filled with sex and drugs and every other kind of decadence. A Martin Scorsese movie starring Leonardo DiCaprio was made from this story. Be forewarned: the chapter that took place in the hospital gave me nightmares for a couple weeks.

Catching the Wolf of Wall Street: More Incredible True Stories of Fortunes, Schemes, Parties, and Prison by Jordan Belfort. This is the followup to the previous book. What happens when Belfort is arrested, how a case was built against him, and what happens after prison.

Bernie Madoff Books

No One Would Listen: A True Financial Thriller by Harry Markopolos. A New York Times bestseller about how Markopolos uncovered Madoff’s scam.

The Wizard of Lies: Bernie Madoff and the Death of Trust by Diana B. Henriques. All about how Madoff pulled off the biggest Ponzi scheme in history. Over 130 five star ratings on Amazon.

The End of Normal: A Wife’s Anguish, A Widow’s New Life by Stephanie Madoff Mack. An inside look at the Madoff family written by the widow of Mark Madoff and the daughter-in-law of Bernard Madoff.Over 200 five star ratings.

Betrayal: The Life and Lies of Bernie Madoff by Andrew Kirtzman. An in-depth look at Madoff and his victims.

Elizabeth Holmes & Theranos Books

Bad Blood: Secrets and Lies in a Silicon Valley Startup by John Carreyrou. Named one of the best books of the year by NPR, The New York Times Book ReviewTimeWall Street Journal, and the Washington Post. An in-depth look at Theranos and Elizabeth Holmes. Over 2,600 five star ratings.

Billion Dollar Facade: The Rise And Fall Of Theranos And Elizabeth Holmes by Phil C. Senior. Short 140 page summary of the Theranos scam.

Other Books about Scams

Scam Me If You Can: Simple Strategies to Outsmart Today’s Rip-off Artists by Frank W. Abagnale. Abagnale was the guy who wrote the book on scamming, Catch Me If You Can, which was made into a major motion picture.

How to Smell a Rat: The Five Signs of Financial Fraud by Ken Fisher. How investment fraudsters operate and how to avoid them. Written my billionaire money manager and former long time Forbes columnist Ken Fisher.

Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World by Tom Wright & Bradley Hope. Named a Best Book of 2018 by the Financial Times and Fortune, it is about the man who swindles $5 billion with the help of Goldman Sachs.

Real Estate Investing

The following are some recent top selling books on real estate investing, shown by category.

Rental Property Investing by Charles Pennyfeather

Real Estate Investment by Lee Strong

Preparing for a Property Upturn: Trends and Pitfalls in Real Estate Investments by Ku Swee Yong

Keep Claiming It!: A Guide To Property Depreciation by Tyron Hyde

Real Estate Investment 101: Learn The Passive Income That Everyone Is Talking About by Meir Zaslavskiy

Real Estate Investing UNCENSORED: Real Answers From The Flipping Coach by Delinda Harrelson

Success Secrets of Real Estate Investorsby Peter Crisp

How To Jump Into Property Investing: Without Being Eaten By Sharks by Mike Harvey

Real Estate Trivia by Fred Fuld III

Business Books

Strategize to Win By Carla A. Harris. A Wall Street veteran offers proven strategies for success.

The Pocket Small Business Owner’s Guide to Building Your Business By Kevin Devine. Each step of the entrepreneur’s journey.

Boost Your Career By Sander Flaum and Mechele Flaum. How to climb the corporate ladder.

The Serving Mindset By Farnoosh Brock. Practical guide to making sales pitches.

The 7 Principles of Public Speaking By Richard Zeoli. Improve your communication skills.

10-Minute Focus By Daniel Walter. Guide to maintaining your focus and maximizing productivity.

Chasing the High By Michael G. Dash. How to manage the highs and lows of business.

Getting to Yes By Roger Fisher, William Ury, and Bruce Patton. Master the art of win-win agreements.

Your Living Trust & Estate Plan By Harvey J. Platt. Tips on creating a living trust, will, and estate plan.

Happy Reading! Merry Christmas! Happy Hanukkah! Happy Holidays! Happy New Year!

Disclosure: A few of the above books were written by me. This page contains Amazon Affiliate links

Thursday, December 03, 2020

Top Tax Selling Stocks Selling Below Cash per Share

  Please note that this is a sister publication of WallStreetNewsNetwork ( https://WStNN.com ) and postings will end on this site shortly.  

by Fred Fuld III

A tax selling stock is a stock that is currently selling for a low price but was trading at much higher levels earlier in the year.

What is Tax Harvesting?

As the year-end approaches, many investors use the strategy called tax harvesting , which is selling stocks the have tanked to offset any gains that may have been established sometime during the year.

With strong selling, the price of stocks that have had big drops tends to fall far more than what would normally take place during the rest of the year.

So traders and investors are on the lookout for stocks that are heavily hit, hoping for a little (or big) bounce in January, once the tax selling is over.

What is Cash per Share?

But if you can find a stock that is selling below cash per share, you have a double bonus. The cash per share is the amount of cash the company has divided by the number of shares.

So if you are looking for these types of stocks, see below for a selection of some that have dropped by over 50% year-to-date. Most have low market capitalizations so they should be considered speculative. However, all of these stocks are selling below cash per share.

What is the Price to Book Ratio?

In addition, they all have a price to book ratio of less than one. The Price toBook ratio, in simple terms, is what each share would be worth if the company went out of business today and all assets sold off. The lower the ratio, the better. And if the number is less than one, it means that each share is worth more than the assets.

Here is the list. Dropped more than 50% this year, selling below cash per share, low priced to book ratio, and a price to sales ratio of less than one. All are United States based companies.

List of Tax Selling Stocks


Acorda Therapeutics, Inc.ACOR
Peabody Energy CorporationBTU
Cumulus Media Inc.CMLS
For a list of over 10 tax selling stocks selling below cash per share, go HERE.

Just remember, these stocks may be trading at a very low price for a reason. 

Happy investing.

Stocks Going Ex Dividend in December 2020

  Please note that this is a sister publication of WallStreetNewsNetwork ( https://WStNN.com ) and postings will end on this site shortly. 

 The following is a short list of some of the many stocks going ex dividend during the next month.

Many traders and investors use the stock trading technique called ‘Buying Dividends,’ also commonly referred to as ‘Dividend Capture.’ This is the strategy of buying stocks before the ex dividend date and selling the stock shortly after the ex date at about the same price, yet still being entitled to the dividend.

TOP DIVIDEND STOCKS

This technique generally works in bull markets and flat or choppy markets, but you need to avoid the strategy during bear markets. In order to be entitled to the dividend, you have to buy the stock before the ex-dividend date, and you can’t sell the stock until after the ex date.

The actual dividend may not be paid for another few weeks. WallStreetNewsNetwork.com has compiled a downloadable and sortable list of the stocks going ex dividend in the near future. The list contains many dividend paying companies, lots with market caps over $500 million, and many with yields over 2%. Here are a few examples showing the stock symbol, the ex-dividend date, the periodic dividend amount.

Costco Wholesale Corporation (COST)12/1/20100.72%
Nike, Inc. (NKE)12/4/200.2750.82%
Dick’s Sporting Goods Inc (DKS)12/10/200.3132.10%
Walmart Inc. (WMT)12/10/200.541.42%
Best Buy Co., Inc. (BBY)12/14/200.551.95%
ADT Inc. (ADT)12/18/200.0351.75%
Portland General Electric Company (POR)12/24/200.4073.83%
Xerox Holdings Corporation (XRX)12/30/200.254.31%

The additional ex-dividend stocks can be found HERE . (If you have been to the page before, and the latest link doesn’t show up, you may have to empty your cache.) If you like dividend stocks, you should check out some of the other high yield stock lists at WStNN.com HERE . Most of the lists are free.

Dividend definitions:

Declaration date: the day that the company declares that there is going to be an upcoming dividend.

Ex-dividend date: the day on which if you buy the stock, you would not be entitled to that particular dividend; or the first day on which a shareholder can sell the shares and still be entitled to the dividend.

Record date: the day when you must be on the company’s books as a shareholder to receive the dividend. The ex-dividend date is normally set for stocks at two business days before the record date.

Payment date: the day on which the dividend payment is actually made, which can be as long at two months after the ex date.

TOP DIVIDEND STOCKS

Don’t forget to reconfirm the ex-dividend date with the company before implementing this technique.

Disclosure: Author did not own any of the above at the time the article was written; affiliate links.

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