a short squeeze refers to a jump in a stock's price, forcing a large number of short sellers to close their position, which in effect pushes the price even higher. when an investor shorts a stock, he borrows shares from another account and sells them, agreeing to replace the stock at a later date. short sellers predict the price will go down, enabling them to buy the shares at a lower price. when the share price starts to rise, many of these same investors will decide to buy the stock before their losses escalate further. this flood of buy orders causes the price to clime even higher. first class aeronautics, an upstart aircraft maker, recently unveiled its new flagship model. the ? still late for several months, leading many investors to question whether the plain had design issues. consequently, many of them decided to short the company's stock. but, as it turned out, initial orders ? stronger than expected during the plain's first few weeks on the market, pushing the company's share price from $17 per share to $20. fearing a continued surge, many of the short sellers bought the stock to close out their position. these purchases push the stock higher still to $23 a share. it's important to remember that this secondary push ? with the large number of short positions than the stock's fundamentals. contrarian investors will sometimes try to cash in on this phenomenon by taking a long position on heavily shorted stocks. that is, buying them with the hope they'll appreciate. going against the crowd like this is typically a high-risk, high-reward proposition. even so, some feel it is safer to bet on a stock rising than on one falling, where the potential losses are limitless.
- short squeeze・・・踏み上げ