2
votes
2answers
96 views

How to calculate how far a shorted stock's price can rise before broker issues a margin call?

If I short AAPL at 500$, how much can the stock rise before I get a margin call? Does it depend on how much Cash/Equity in other stocks I hold in my margin account? I just thought that if margin ...
2
votes
1answer
163 views

Does the uptick rule apply to all stocks/ETFs and other securities, or only specific ones?

Does the uptick rule on U.S. securities apply universally across all stocks, all bonds, all futures and all options? Or is it limited to certain category of securities/instruments? Is there a ...
5
votes
1answer
186 views

What happens if a company you hold short merges with another company?

I know how mergers (typically) work when you're long a company, you simply get shares in the merged company equal to your previous market value. But what happens if you hold a short position? The ...
0
votes
2answers
177 views

What do brokers do with bad stock?

I'm new to financial markets and how they work is still fuzzy, so bear with me. This question actually has multiple questions :( ... and a bit of a story. I was watching a YouTube video on the ...
0
votes
1answer
211 views

What would stop someone from taking advantage of wide bid-offer spreads in extended hours trading via short selling?

I understand that the less volume occurring in a security, the less liquidity (the wider the bid-offer spread). So my question is, in pre-market and after-hours trading, when bid-offer can widen ...
3
votes
1answer
2k views

What is the “Short sale circuit breaker rule”?

Apparently there's a NASDAQ rule called something like short sale circuit breaker which limits how much a stock can be sold short after a certain drop in price or something like that. It really makes ...
4
votes
1answer
81 views

How do we know the number of shorted shares of a stock?

I am reading this article which discusses Tesla's stock (TSLA). The article states: 27.5 million shares of Tesla are held short, or about 41 percent of the float. How can the number of shorted ...
1
vote
1answer
357 views

What does the settlement date of short interest mean?

NASDAQ lists data like this for the short interest in Walmart: Settlement Date Short Interest Avg Daily Share Volume Days To Cover 4/30/2013 27,988,175 7,442,123 ...
1
vote
2answers
320 views

How can I make a profit by selling a stock short?

This link states: Shorting (or selling short) allows professional traders to profit regardless of whether the market is moving up or down, which is why professional traders usually only care ...
2
votes
3answers
298 views

If prices are falling, who will lend shares to short sellers?

Short selling is a process that involves borrowing shares from a person, selling them and then buying them back at a lower price, thus realizing a profit. In this situation, knowing that prices are ...
4
votes
1answer
130 views

Borrowed shares how are they tracked?

When a short position is opened in the stock market how does the brokerage know whether the trader has actually borrowed the shares or not?
4
votes
3answers
159 views

How to exclude stock from mutual fund

One of the mutual funds I invest in is indexed to the S&P/TSX Composite Index. I have a moral objection to one of the companies who makes up a small part of this index. Hypothetically, is there a ...
6
votes
1answer
372 views

Wells Fargo Brokerage has no shares of stock to short

I want to short several hundred shares of a stock. Wells Fargo brokerage has no shares to short. Would a different brokerage be likely to have access to shortable shares, or do they all access the ...
4
votes
2answers
170 views

Can the shorting of S&P futures negatively affect the underlying index and constituent stocks?

I hear people on financial shows talk all the time about index futures like SPY and QQQQ affecting the actual index. Can shorting these futures (in huge quantities obviously) cause the underlying ...
12
votes
3answers
694 views

Why is short-selling considered more “advanced” than a simple buy?

Considering the downward spiral in the market (which many are predicted will continue), I was thinking perhaps selling short would be the right strategy. But from what I can tell on my brokerage ...
3
votes
3answers
566 views

“Diversifying” by going Long and Short Simultaneously

I was hoping someone could take a critical eye to an idea i've had. Traditionally it's said that one should diversify across various asset classes and ultimately types to spread the risk out based on ...
6
votes
5answers
621 views

Is short selling a good hedging strategy during overzealous market conditions?

As the stock market keeps increasing, I'm more and more interested in short selling as a strategy to hedge risk and make some money. History has shown that anything that goes up, must come down. The ...
1
vote
3answers
357 views

Since many brokers disallow investors from shorting sub-$5 stocks, why don't all companies split their stock until it is sub-$5

Seems like a no-brainer? I guess if your security is not marginable, it can't be bought long on margin either, but I would also guess for most companies there are more margined shorts than margined ...
11
votes
3answers
2k views

Why can't I short a stock that sells for less than $5? Is there another way to “go short” on them?

I don't like satellite radio as a business and I want to short Sirius (SIRI). The stock sells for less than $5, so my broker won't let me short it. Is this a limitation of my broker? Or some SEC ...
16
votes
3answers
2k views

What is the meaning of “short selling” or “going short” a stock?

Can someone please explain the meaning of 'shorting' a stock with an example?