Carver Bancorp Inc (NASDAQ:CARV)
Carver Bancorp is a commercial and consumer bank headquartered in New York. The stock is also the perfect low float short squeeze candidate.
Carver’s 560,000-share float is minuscule, creating plenty of opportunity for extreme volatility if trading volume rises. Carver also has 18.5% of its float held short.
The stock has previously demonstrated its potential for extreme volatility. In a matter of days back in June 2020, Carver’s stock price rocketed from under $2 to as high as $22.97.
Sequential Brands Group Inc (NASDAQ:SQBG)
Sequential Brands promotes, markets and licenses consumer brands, including Martha Stewart, Jessica Simpson and AND1.
Low float stocks can be some of the most volatile stocks in the market. If you mix in a short squeeze, the potential short-term gains in a low float stock .
Low float stocks can be some of the most volatile stocks in the market. If you mix in a short squeeze, the potential short-term gains in a low float stock can be extreme.
A stock s float is the number of shares that trade freely on the public market. Because insiders and institutional investors don’t typically trade their shares on a daily basis, those shares don’t typically contribute to a stock s near-term liquidity.
Float is the number of shares that remain after accounting for insider and institutional ownership.
Why Is It Important? When a stock gains positive momentum in the market, momentum buyers can rush in all at once. If a stock has a high short interest, short covering can quickly ramp up demand for shares, triggering a short squeeze. Since low float stocks have relatively few shares trading freely, a major imbalance in supply and demand can serve as rocket fuel for the share price.
Prometheus Biosciences Inc (NASDAQ:RXDX)
Prometheus Biosciences is a biotechnology company focused on therapies and diagnostic products for the treatment of inflammatory bowel disease (IBD). The stock completed its IPO in March and is also the perfect short squeeze candidate within the sector.
Prometheus’ 970,000-share float is minuscule, creating plenty of opportunity for extreme volatility if trading volume rises. Prometheus also has 30.2% of its float held short, a fairly high short percent of float.
Finally, the stock has already demonstrated its potential for extreme volatility. In about two months on the market, Prometheus shares have already swung from its IPO price of $19 all the way up to $28.33 in March, back down to $16.11 a couple of weeks later, back up to $30.62 in mid-April and then back down to $21.84 on Thursday.
Ambow Education Holding Ltd (NYSE:AMBO)
Ambow Education is an online career enhancement and educational services provider. The stock is also the perfect short squeeze candidate within the consumer staples sector.
Ambow’s 2.3 million-share float is far lower than the other two heavily shorted stocks mentioned. Ambow has 28.6% of its float held short, a relatively high short percent of float. In addition, short squeeze traders have frequently targeted stocks trading under $5 per share this year, and Ambow’s shares currently trade at just $2.14.
Finally, Ambo has repeatedly demonstrated its potential for extreme volatility. In September 2020, the stock jumped from $1.63 to as high as $6.43 in a matter of days. In January 2021, Ambow again rocketed from under $2.50 to as high as $5.68 in just a few days.