Avis Budget Group (NASDAQ: CAR) just completed one of the most dramatic short squeeze collapses in recent memory. After surging +600% month-over-month to hit an intraday high of $847 on April 22, 2026, the stock crashed -72% in just 26 hours, landing at $204 on April 24.
What happened? Two hedge funds, SRS Investment Management (~49% stake) and Pentwater Capital (22%), effectively locked up 82% of CAR's float. Including swap agreements, their combined economic control reached 108%, leaving short sellers with almost nothing to borrow. When optimism about Trump's 25% auto tariffs sparked buying, short sellers were forced to cover, triggering the squeeze.
The collapse trigger: On April 22-23, Avis filed an at-the-market (ATM) offering for up to 5 million shares, diluting existing shareholders. JPMorgan simultaneously downgraded to Underweight. CAR fell -48.38% in a single day (April 23), then another -10.97% the next day.
What Korean retail investors need to know: This pattern is familiar. In 2021, Korean retail investors poured $26.93M into AMC Entertainment after the squeeze peak, while Wall Street was selling. The same trap applied here.
Three indicators to watch before entering a short squeeze: (1) Short Interest % above 20% signals squeeze risk (based on historical GME, AMC, CAR data); (2) Days to Cover above 5 means sustained squeeze but slow recovery; (3) Float concentration above 50% by any institution means no shares to borrow.
For the full analysis in Korean, visit Snakestock
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