A hot new trading idea did the rounds this week: the worst is over for U.S. oil and gas stocks. Some people took it so seriously they went hunting for the ugliest oil stocks they could find, sparking a stunning rally in stocks of nearly bankrupt shale companies.

Shares in Chesapeake Energy Corp., for example, which has been teetering on the brink of collapse, shot up about 400% in a few days, before toppling again towards the end of the week.

“Investors are just betting on recovery as a theme,” said Nathan Anderson at Hindenburg Research. “The way they express that is by buying stocks that are the most down, hoping that they’ll revert to their pre-COVID level.”

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