Stockpickr: The Top 10 Battleground Stocks

Another short-squeeze candidate is wireless communications company USA Mobility(USMO Quote). The paging business is a declining business, and revenue has been declining at USA Mobility, but the important thing to consider is whether the cash flows generated by the company make up for it. In other words, if the company plans on returning more cash than the current market cap plus interest over the next five to 10 years, then this investment will be a home run.

USA Mobility's short-interest ratio is 11, and recent insider buying, according to Securities and Exchange Commission filings, is $2.9 million. One of the hedge funds that holds a position in the stock is Okumus Capital, which was founded in 1997 by Ahmet Okumus, a follower of the Benjamin Graham and David Dodd style of value investing.

None of the funds managed by Okumus Capital has experienced a down year in its history. Okumus invests in a diverse and surprising group of companies, including Wal-Mart(WMT Quote), Dell(DELL Quote) and Avis Budget Group(CAR Quote). For all of its holdings, check out the Okumus Capital page on Stockpickr.

Another name with the potential for a short squeeze is Jo-Ann Stores(JAS Quote), which has a short-interest ratio of 18 and saw insider buying of $19 million last month.

One of the professional investors in Jo-Ann shares is Robert Olstein, the chairman and chief investment officer of the Olstein Financial Alert Fund, a value stock fund that has returned an annualized 16.8%. Olstein is a retail specialist, so I like to track his latest holdings to see what retailers he likes.

For instance, as you can see from the Olstein Financial Alert Fund page on Stockpickr, he's been loading up on Federated Department Stores(FD Quote) and, interestingly, turnaround play RadioShack(RSH Quote).

For other names that offer potential short-squeeze plays, check out the Top 10 Short Squeezes portfolio at Stockpickr.com.