Over the weekend, brokerage firm Interactive Brokers sent around an interesting list. The firm is raising its margin requirements for those silly enough to invest in Chinese reverse merger trash. Check it out here. The margin requirements for these stock will rise from 50% on the 11th of April, to 75% on the 12th, to 100% on the 13th of April. The cost of investing in this garbage asset class has just gone up. A lot.
These are the stocks on IB’s hit list: ADY, AUTC, BORN, CAAS, CAGC, CAST, CBEH, CCME, CDM, CEU, CGA, CHBT, CHNG, CHOP, CIL, CMFO, CNET, CSKI, CTEK, DEER, DGW, FEED, FSIN, GFRE, GPRC, HEAT, HOGS, HRBN, JGBO, LIWA, LTUS, NEP, NEWN, NIV, ONP, PUDA, RINO, SCEI, SDTH, SKBI, SOKF, SYUT, UTA, VALV, YONG, YUII, ZSTN.
Buyersstrike! readers will certainly recognize some of the names on the list.
CAGC and NEP are Gareth specials.
Ping Luo is the notorious “analyst” behind the famous Global Hunter CCME report. Her coverage universe included these gems from the IB list: CMFO, SOKF, VALV, SDTH, CAST, CSKI, FEED, and HRBN. Read more about Ping here and here. Asensio & Co. has written extensively on CSKI, Read the reports here.
CAGC and DGW‘s sister company DYNP are G. Michael Bennett companies.
While many of the names on the IB list have already been halted (CCME, CAGC, NIV, CDM, SDTH, CIL) and others have already been delisted (RINO), there is still a treasure trove of juicy junk to be explored. SYUT was involved in the tainted milk scandals. FEED, FSIN and GFRE are particularly interesting….perhaps worthy of greater examination.