Watch the SHO list. If that's the case, it'll show up as the hedgies pile into a sure thing. They will naked short it, with the help of the prime brokers, and then be sure it goes down. Cramer's talking about an FBI rumor, and that's how they play. If you have your short on, you may get really lucky. http://www.nasdaqtrader.com/aspx/regsho.aspx Notice MAMA on there, btw. They can be wrong.
OOPS 08:18 Early Pre-market Gappers Gapping Up: MAMA +24.2%, PTT +5.4%, TOPT +5.2%, MNST +5.1%, NFI +5.1%, LEND +4.7%, NEW +3.9%
Lend has pulled back some: Yesterday's close @ 17.2 Pre- Market Bid/Ask @ 17.33/17.8 I've got some cushion in there, as I opened at 17.45. Also, yesterday was a similar story. Opened up 2-3%, only to drop as much as 15%. I took a nice profit off that swing. If it breaks 18.25, I'll close out. Fortunately, my initial position was larger than my current position. Still, never fun giving money back to the market -- fingers crossed! Good Trading!
I'm living vicariously through you this morning Cal...I hope LEND does what it did yesterday. I might short dhi and sunw this morning...thoughts?
Make sure you take market conditions into consideration. The bulls appear poised for a run this morning. We'll have to see if that sentiment holds...
Think about it. Naked shorts get pinched, it's ugly. You're short some 70 =100percent of the float on some of these. Something has to give.
You can trade the options. I did yesterday. The spread is around .15, but given a daily (or hourly!) trading range of a dollar or two, that's not terrible.