RealMoney Radio Mailbag: Ripe for a Squeeze

Cramer tells a listener when the potential is there for a short squeeze.
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Editor's note: The following are questions received from listeners of "RealMoney Radio." To send Cramer a question about topics from his radio show, click here. Listen to Cramer's latest radio show by clicking here.

What percentage of shares sold short does it take to drive a short-squeeze?-- Bill from Texas

Jim Cramer

: There is no exact percentage required for a short-squeeze, but a short starts to become crowded when about 20% of the float is shorted. That is where you begin to see the potential for a squeeze because it represents a big shift to negative sentiment.

Do you still like Goldman Sachs (GS) - Get Report?-- Timothy from New York

Jim Cramer

: I still like Goldman because I believe the stock can go up to $225. There is no sign that the bank is having troubles in trading, and the M&A deal flow is just outrageous right now.

A lot of bears are arguing that the brokerage cycle is peaking, but I don't think the data supports that thesis.

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