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 China-based electric motors manufacturer Harbin Electric (Nasdaq: HRBN) crashed and burned today, falling as much as 59% -- yes, in a single day -- on more than 10 times the average trading volume.

So what: Not content with the severe drop caused by a negative research note last week, Citron Research piled on today with an even more damning missive. Among other things, Citron calls Harbin a "fraud" propped up by a "sham" buyout offer, and it posits that the stock is worth closer to $0 than the supposed go-private price tag of $24 per share.

Now what: I'm usually suspicious of these efforts by a small-time research firm to expose small-cap frauds, particularly when the firm is shorting the shares in question as Citron did with Harbin. But this particular whistleblower actually has a bit of a track record, having attacked Chinese software firm Longtop Financial Technologies (NYSE: LFT) with plenty of venom. Trading of that stock was halted in mid-May and remains frozen today as Chinese and American officials sort through a pile of financial fraud claims on reverse-merger stocks such as Harbin Electric.

Harbin's CEO has reiterated his buyout offer along with a bank loan to finance it all -- but Citron says that the loan itself must be fraudulent. You decide who to believe while I treat this stock as toxic. The risks of either buying or shorting shares far outweigh any reward I could imagine at this point.

Interested in more info on Harbin Electric? Add it to your watchlist.