General Cable Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of General Cable (NYSE: BGC  ) popped by an astounding 82% in intraday trading today, reaching prices not seen since August 2008.

So what: But then General Cable came back to earth and has traded within a much more narrow 13% range around the $29 mark all day long. While the $51.40 price goes down as a 52-week high in the company's trading records, it was a blip that says nothing of substance about the company or its business.

Now what: This episode recalls memories of the flash crash of last May. Whether caused by hyperactive computerized trading algorithms or by a careless market order at a very inopportune time, this spike underlines the volatility and easy manipulation of small-cap companies with their relatively thin trading volumes. General Cable is still gaining ground today thanks to a buyout bid for rival CommScope (NYSE: CTV  ) , but the 4% boost we're talking about is nowhere near the mirage of the daily highs.  

Interested in more info on General Cable? Add it to your watchlist by clicking here.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool is investors writing for investors.


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