RiT Technologies Plunged: 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 structured cabling specialist RiT Technologies (Nasdaq: RITT  ) are caught in a 15.7% free fall today.

So what: The other half of this story is that these shares are still 46% more expensive than they were Monday morning. That sudden race may have been an extended short squeeze, seeing as how nearly 20% of the company's shares were sold short in mid-November.

Now what: This penny stock is actually up more than 650% over the past three months even after today's damage; it's easy to see why the shorts were piling on. RiT also illustrates the dangers of short-selling thinly traded and highly volatile stocks. Then again, it's also dangerous to buy them; this stock fell more than 40% in two separate three-month periods this year and could easily do it again.

Interested in more info on RiT Technologies? Add it to your watchlist.

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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