What happened

Shares of 9F (JFU -2.44%) absolutely soared on Thursday even though there wasn't any company-specific news. Rather, this stock just happened to be a favorite among day traders today, with a mind-blowing amount of trading volume pouring in -- almost 70 million as of this writing, which is almost 30 times its three-month average, according to Yahoo Finance. As of 3 p.m. EST, the stock was up about 70% and climbing.

So what

Operating in China, 9F is a financial services company. It has a stock brokerage business that it rebranded in recent weeks. But in its filings with the Securities and Exchange Commission (SEC), it says revenue is generated from lending services. That's a problem, because the COVID-19 pandemic reduced home buying in China in 2020. The last financial update the company gave was in September; six-month revenue was down a whopping 61% year over year, and its net loss was a painful $64 million.

A red rocket ship prepares to fly over a rising bar chart.

Image source: Getty Images.

With results like that, you'd think there'd be a lot of short interest in 9F stock. However, today's move isn't the result of a short squeeze -- short interest is so low it can be covered in under one trading day. Rather, today's move is what can happen if enough day traders jump into an obscure penny stock.

Now what

If you've made money trading 9F stock today, congrats. Day trading is tricky; most people fail to make money, and even successful traders are left holding the bag on occasion. After all, eventually the music ends for these trades. Timing these things isn't easy, and that's why I like to stick to the safer method of buying stock in top companies and holding for the long term. And unless 9F can effectively diversify its revenue away from lending, I'm not sure it would be a top company worthy of a long-term investment.