Lightspeed Trader Adds Short Locate Functionality

Robert Morse said:
FSU,

These are locates not borrows. You pay for the l locate when you can't get it for free from the clearing firm through us. You pay this one time fee if you use the locate or not, after you except the charge, The cost of a borrow for overnight, is what the Clearing firm charges. You can bet any stock that needs a locate this way, is expensive to hold overnight, Most of our clients only DT these,
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Interesting, thanks Bob.
 
Robert Morse said:
The located is good for the day and recycles. If I pay for 2000 shares, I can short 2000, buy back, short 2000, buy back..etc.
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Any sense for how your short availability / short fees compare to IB? For instance, I haven't been charged a locate fee from IB -- does this imply that they can generally find things without a fee, or that Lightspeed can locate more hard to borrows than IB, but only if the client pays a fee?
 
We clear Wedbush Securities. They provide the locates that are free. The Velocity Capital service is only for hard to borrow securities that we can't locate. I have no idea in any one day or any one security, if IB or Wedbush can provide a locate if the other one can't. I can tell you that very few, if any, retail brokers besides us offer third party locates. These locates that traders pay for, are generally VERY hard to locate let alone borrow overnight. That is why they get the fees they do.
 
Robert,

This sounds like it is for those stocks that are classified 'T' on the Level 2 screen. For those stocks that are listed as 'L' Locate will there be an automated way to request those locates? We currently need to email the short desk and I may miss out on an entry in the few minutes between request and location.
 
T stands for Threshold. It is my understanding that stocks on the Threshold just can't be sold short at all. L stands for locate, which means it is NOT on the ETB list. Regular locates are not automated at this time because of the concern over abuse. There is the concern that traders will ask for a lot of locates they will not use and we will have less for those that do need it.
 
Robert Morse said:
T stands for Threshold. It is my understanding that stocks on the Threshold just can't be sold short at all. L stands for locate, which means it is NOT on the ETB list. Regular locates are not automated at this time because of the concern over abuse. There is the concern that traders will ask for a lot of locates they will not use and we will have less for those that do need it.
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Understandable, IMHO from a backoffice perspective, just allow x number of active locates without an active position.
 
dennisa said:
Understandable, IMHO from a backoffice perspective, just allow x number of active locates without an active position.
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I have to agree. I suggested setting a limit based on account size or even just 2000 shares per request. Maybe one day. I don't make those decisions.
 
Robert Morse said:
T stands for Threshold. It is my understanding that stocks on the Threshold just can't be sold short at all. L stands for locate, which means it is NOT on the ETB list. Regular locates are not automated at this time because of the concern over abuse. There is the concern that traders will ask for a lot of locates they will not use and we will have less for those that do need it.
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IB automates regular locates. I tried Lightspeed for about a week until tiring of all the phone calls required for authorization to short. I'll try it again if this issue gets resolved.
 
You can put in a locate request via email too, though the fact that it's 2017 and Wedbush locates require emails or phone calls is absurd. Just like jbusse, I mostly avoid Lightspeed these days because the locate process is annoying and slow compared to IB, ETrade and almost anyone else.
 
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