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 Harbin Electric (Nasdaq: HRBN) jumped 10% momentarily on large trading volume today.

So what: The newswires were quiet today, but someone bid up the stock just before 10:30 a.m. ET by buying a large batch of shares. This could have been a short seller closing out a position, considering that 20% of shares outstanding are sold short.

Now what: I would see this as an opportunity to get out of Harbin Electric, considering the risks Chinese reverse mergers have shown lately. Interactive Brokers recently increased margin requirements for a list of such companies, including Harbin Electric. Reports and rumors that the CEO will take the company private have been swirling for months. I may miss out if the company is indeed taken private, but I'm going to stay away from the potential risks Harbin poses.

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