Top Health Care Short-Squeeze Plays

Updated from 7:09 a.m. EDT

Health care stocks generally have underperformed most other sectors during the last year or two. This underperformance could offer an opportunity for short-squeeze plays from heavily shorted biotechnology, health facilities, pharmaceutical and medical equipment stocks.

A short squeeze takes place when a stock's short-sellers are forced to cover their positions quickly when the stock they are betting against starts climbing on positive news. As the short-sellers are forced to cover, the price of the stock often moves even higher.

The metric for measuring short-squeeze plays is the short ratio, which represents the number of days it would take a stock's short sellers to cover their positions based on the stock's recent average daily trading volume. ...