Replies to post #74505 on Value Microcaps Motherboard

[lentinman]

Kipp: RMBS:

The greatest short squeeze I recall seeing was Rambus in early 2000. It went from $20 to $120 in less than a month on no news - just covering by the huge short ratio at that time. On the long term chart of RMBS it just looks like a straight line up - and that is what it seemed like at the time.

You would need to have 5 stocks go up 100% each to compensate for that kind of hit. That's why I don't do it. I realize you can set limits, but my point is that moves are often much faster and much greater when shorts have to cover.

I generally feel pretty good about going LONG on a stock that has a high short ratio - assuming I like other aspects of it as well. There is always a chance that a big short covering rally will take place.

Len