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 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 share price.
Buying a low float stock with high short interest isn’t a guarantee of a short squeeze. There still typically needs to be some form of catalyst to get the stock moving in the first place. However, traders can keep an eye on these stocks for any signs of life to try to catch most of a potential big move.
Here are the 14 lowest-float stocks with short percents of float above 20%, according to Finviz:
- TKK SYMPHONY AC/SH SH (NASDAQ: TKKS), 640,000 float, 35.9% short.
- Trans World Entertainment Corporation (NASDAQ: TWMC), 660,000 float, 21.7% short.
- Jaguar Health Inc (NASDAQ: JAGX), 840,000 float, 83.1% short.
- Everest Re Group Ltd (NYSE: RE), 1.62 million float, 66.1% short.
- Pier 1 Imports Inc (NYSE: PIR), 2.77 million float, 33.4% short.
- Francesca's Holdings Corp (NASDAQ: FRAN), 2.89 million float, 36.8% short.
- PPDAI Group Inc - ADR (NYSE: PPDF), 3.4 million float, 29.8% short.
- EVI Industries Inc (NYSE: EVI), 4.36 million float, 22.9% short.
- US Xpress Enterprises Inc (NYSE: USX), 4.55 million float, 49.8% short.
- vTv Therapeutics Inc (NASDAQ: VTVT), 4.68 million float, 26.7% short.
- Revlon Inc (NYSE: REV), 4.69 million float, 49.8% short.
- National Presto Industries Inc. (NYSE: NPK), 4.92 million float, 20.7% short.
- Catasys, Inc. (NASDAQ: CATS), 6.31 million float, 39.5% short.
- Blue Apron Holdings Inc (NYSE: APRN), 6.48 million float, 27.8% short.
These low-float, high-short stock short squeezes can be extremely difficult to time and trade, so investors need to be careful. In addition, share prices in these low-float stocks can fall just as easily and quickly as they can rise, making trading even more dangerous.
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