Looking for broker to short pennies; anything better than Suretrader?

S

stang351

I've been using Scottrade for 10 years, and have generally been happy with it, but I want to short a # of penny stocks (well, not all pennies technically... OTC/BB stocks ranging from 5 cents to a few bucks in price at this time).

They don't offer the ability to short the stocks I'm looking for. Neither do Etrade and TDAmeritrade.

I have mostly finished signing up for a Suretrade account, and they seem to both allow shorting of these stocks and have access to shares. But one fee - of the many, Suretrader has an insane pile of fees - that is worrying to me is a 1% overnight charge on all shorts.

I'm not planning to short something and sell it the same day; in my mind it might take a month for the world to end for this stock like I hope. But clearly, unless I'm shorting very quickly, Suretrader's fees will kill me.

Are there any other brokers out there that:
a) Allow shorting OTC type stocks
b) Have decent access to shares
c) Have good fee structures, in particular nothing like that 1% overnight fee. I'm okay paying a little more than the $7-10/trade I'm used to on scottrade, though obviously all fees have to be reasonable.

I'd be trading w/ an account in the $5-25k range.

Thanks all!
 
I don't believe thats true.

If you go to the OTCmarkets page, it says shorting OTC stocks is allowed (though most major US brokers don't allow it). Further, it shows that the short interest in some of these stocks has grown. So 'someone' is able to short them... whether its institutional, people, or what have you.

And I want to also, lol

Example:
http://www.otcmarkets.com/stock/CNAB/short-sales

Shows a short interest of several hundred thousand shares.

Suretrader hasn't independently confirmed I could short this through them; i'd have to fund the account first.
 
Deuteronomy_24_7 said:
Did you ask Tim which brokers he prefers?
More...

Just did. Thanks actually... I had run into that link while searching for brokers but initially figured he'd be too busy with his new Lambo to bother and moved. Reconsidered today and had been hoping to at least ask today, figuring that it can't hurt to inquire. Thanks there.

I can't be the only one on here who has been motivated to short pennies though. Any experiences? I do believe Tim references Suretrader on his site... as well as a few others.

Specifically I ran into this link: http://www.timothysykes.com/2015/02/best-penny-stock-brokers-2015/

He mentions he likes Etrade, interactive brokers etc. But clearly Etrade doesn't let you short like this, and its not totally clear what his broker picks will let you do.

zdreg said:
review your sentence.
More...
Ha, true. Okay, you're right. I'm not planning to close my short position after one day. I expect that it'll take weeks/months for the position to work out as I'd want.
 
It's kind of inherent that you're going to find few places to short OTCBB stocks and the ones you find are going to be expensive. The vast majority of short availability comes from the fact that most margin accounts have fine print you sign that allows your broker to lend any stock that you have purchased on margin. Since most stocks trading under $5 aren't marginable by most brokers, there's no pool of these margined stocks for most brokers to lend. I'm not sure how the one's who do lend find their source of lendable stocks, anyone know?
 
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