It takes a lot of guts to short a stock. By hoping the share price will decline, your best-case scenario is that the company goes bankrupt -- a 100% gain. On the other hand, if the stock miraculously rebounds, your potential losses are infinite. Put simply, if you're going to make a short call, you'd better be sure you're right.
Using Motley Fool CAPS, the Fool's 115,000-plus-member investing community, we can see which stocks are receiving the greatest percentage change in "underperform" calls that CAPS All-Star players have made each week. The All-Stars aren't necessarily putting real money behind their shorts, but they do put their CAPS score and their reputations on the line by making such bold calls. A sudden increase in bearish interest from top-rated investors could signal that the stock's one to avoid, or at least deserves further research.
Here are five stocks being bombarded by "underperform" ratings from CAPS All-Stars over the past month:
Company |
Sector |
Change in All-Star Bears From 8/18 to 9/15 |
CAPS Rating
|
CAPS Research |
---|---|---|---|---|
General Electric |
Conglomerates |
35% |
**** |
|
Dell |
Technology |
33% |
** |
|
FirstFed Financial |
Financials |
32% |
* |
|
Cisco |
Technology |
29% |
**** |
|
EMCORE |
Technology |
27% |
** |
Come and join us on CAPS to learn more about these and countless other interesting stock ideas. Sign up for free.