Tesla Motors Club
Can someone take a few moments to explain this short squeeze concept to an ignorant like me, in plain common English please? I had never heard the term till the now infamous tweets last year from Elon. In fact, had never heard the term 'Shorting a stock' till I started following TSLA in 2014. So, this has been educational for me so far!
I understand that short squeeze would occur when the folks who have shorted the stock are "forced to cover" and this depends on each individual account, stock broker, cash levels in account and relationship with the stock broker.
So, say I was a retail investor who shorted 100 shares of Tesla at a price of $300. My stock broker is JP Morgan, I have good relationship with no other risky bets, have other safe investments worth $100,000.
1. At what point would I be forced to cover?
2. How much cash would I need to add to the account to avoid having to cover?
Edit - if this has been already discussed before, just point me to the correct place
I understand that short squeeze would occur when the folks who have shorted the stock are "forced to cover" and this depends on each individual account, stock broker, cash levels in account and relationship with the stock broker.
So, say I was a retail investor who shorted 100 shares of Tesla at a price of $300. My stock broker is JP Morgan, I have good relationship with no other risky bets, have other safe investments worth $100,000.
1. At what point would I be forced to cover?
2. How much cash would I need to add to the account to avoid having to cover?
Edit - if this has been already discussed before, just point me to the correct place