Replies to post #43628 on Pilgrim Petroleum Corp. (PGPM)

[skichic]

OK, stocks are bought either long or short. If you buy short you sell a stock before you actually own it, then when it drops you actually buy the stock back at a lower price (you only short if you think a stock is going down). On penny stocks usually only MMs can short, which CDEL does a lot, who is not just an MM, but also a hedge fund. A short squeeze happens when a stock heads up, before you have covered and that creates panic buying, because the higher the stock goes the more the MM or individual is going to lose. You can lose tremendous amounts of money shorting if you guess wrong, most brokers require you to have a margin account and have a certain net worth to short.