Buying a stock and short selling

[demoship]

If you short against the box, the only thing that'll happen is you have to count capital gains as if you sold the stock regularly.. If you fail to do that, then you could get nailed for trying to evade taxes that way.

One reason I could see for shorting against the box other than for tax reasons, is if there's some major event that's going to occur w/ a company that may make it unshortable (due to many others wanting to short it), you can buy and short against the box w/ your own 2 accounts, so you can effectively short it later without having to worry about borrowing the shares or the uptick rule.

 

[Don Bright]

Quote from demoship:

If you short against the box, the only thing that'll happen is you have to count capital gains as if you sold the stock regularly.. If you fail to do that, then you could get nailed for trying to evade taxes that way.

One reason I could see for shorting against the box other than for tax reasons, is if there's some major event that's going to occur w/ a company that may make it unshortable (due to many others wanting to short it), you can buy and short against the box w/ your own 2 accounts, so you can effectively short it later without having to worry about borrowing the shares or the uptick rule.

You better re-think this a bit. Traders (and investors) have to count their "universal" position in any security for uptick and short sale compliance.

If you're short GE at Schwab, and you buy the same number of shares here at Bright, you are essentially "flat".

I remember, back when I first started trading, thinking "hmmm, I could be long and short, then hit bids with my long stock and make the stock go down, and then my short will make me all sorts of money" - well, I guess I wasn't the first guy to think that way (it's illegal of course), and I have had hundreds of new traders come up with this same "brainstorm" over the last few decades. Same answer, illegal, LOL.

Don

 

[dac8555]

Quote from rcj:

No. It's illegal to be short and long the same stock simultaneously.

you are wrong, it is called "short against the box"..people do it all the time due to certain tax treatment that it recieves.

 

[Hacksaw]

Quote from dac8555:

you are wrong, it is called "short against the box"..people do it all the time due to certain tax treatment that it recieves.

Why dont you read the damn thread before you make another drive by coment....?? ehh?? There were only two people that
knew what the hell they were talking about, here. You arent one of them.