Let’s look at stocks that would benefit from a rally in the market. A "rally" specifically means the Fed stopped aggressively raising interest rates to fight inflation, and the stock market trended upwards consistently. 

In this scenario, stocks that could surge would be those that have a high beta, meaning that they tend to exaggerate trends in the market, stocks that were down significantly so far in 2022, and stocks that have a significant short interest, which could cause a flywheel effect if short sellers are forced to buy their way out of their short positions. 

Let’s look at stocks that would benefit from a rally in the market. A "rally" specifically means the Fed stopped aggressively raising interest rates to fight inflation, and the stock market trended upwards consistently.   In this scenario, stocks that could surge would be those that have a high beta, meaning that they tend to exaggerate trends in the market, stocks that were down significantly so far in 2022, and stocks that have a significant short interest, which could cause a flywheel effect if short sellers are forced to buy their way out of their short positions.

Sam Mendoza

Been thinking about the most shorted stocks in each industry.  Mainly data about which companies and industries Wall Street feels will continue to fall in the coming months. I like to invest in stocks that may become targets of a short squeeze, as this can lead to significant profits in a short period. Instead of looking at different stocks with high short interest, i'll share six industries, each with many stocks with high short interest, in case any of you care to analyze more potential trading opportunities. #The Most Important Thing

The Most Important Thing

History doesn't repeat itself, but it often rhymes. 

As of mid-August, more than 38,000 workers in the tech sector have been laid off. 

The market cap of the top 30 tech stocks has dropped $4.3 trillion in the first 6 months of 2022.
#The Most Important Thing

So we probably haven’t bottomed out yet but there will be little rallies along the way and we’re probably in the midst of a small rally? (Checking to see my understanding is correct or not)

You can use the numbers here to get a sense of historically how big bear market bounces cycle. 

Another interesting historical data point - bear market crashes generally last ~18 months before bottoming. 

Every cycle is different, so I personally view this as guidance on when to lean more or less bearish

You can use the numbers here to get a sense of historically how big bear market bounces cycle.   Another interesting historical data point - bear market crashes generally last ~18 months before bottoming.   Every cycle is different, so I personally view this as guidance on when to lean more or less bearish

Alex

TechCrunch Social

Chris Nheu

History doesn't repeat itself, but it often rhymes.   As of mid-August, more than 38,000 workers in the tech sector have been laid off.   The market cap of the top 30 tech stocks has dropped $4.3 trillion in the first 6 months of 2022. #The Most Important Thing

Stock to Watch: Royal Caribbean Group (NYSE: RCL)

• This is a Consumer Services stock. 
• The stock is down 54.6% in the first half of 2022. 
• The short interest of the company is 7.4% of its outstanding float. 
• The company has a beta of 2.5.

Stock to Watch: Royal Caribbean Group (NYSE: RCL)  • This is a Consumer Services stock.  • The stock is down 54.6% in the first half of 2022.  • The short interest of the company is 7.4% of its outstanding float.  • The company has a beta of 2.5.

You can use the above as rough guide points for your overall strategy. I personally do short aggressively during bear markets but for others they might just use this to try to take advantage of bear market rallies

Yes - bear markets rally much harder than bull markets because of short sellers covering (Sam’s original point)

Sam Mendoza

A group of likeminded people in The Most Important Thing are talking about this.