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[dmo]

Quote from exQQQQseme:

I will tell you that I short stocks using online trading through Schwab. They are always responsive when I have a question or a problem.

Thanks for your reply QQ. Ironically, Schwab was the company that "could not" borrow the stock, which was USO. A few minutes later I shorted a few hundred shares with no problem in my newly-opened IB account. I thought maybe it was a mistake and they would blow me out of it overnight, but I've got the IB screen open in front of me and I'm still short it.

I cannot imagine how Schwab cannot internally borrow this stock. I guess the lesson is that it's all about individual company policies, rather than SEC dictates or market realities.

Schwab is a nice, user-friendly company. IB - from my 1.2-day experience with them - is not so warm and fuzzy. Their software is downright hostile. But they seem to have a lot of powerful capabilities - as does their software, if you can wrestle it to the ground first.

 

[exQQQQseme]

dmo, I've never dealt with IB.

Upon reading your posting I went to the Schwab site and tried to place a short stock order on USO. Not surprising I received the Hard to Borrow Notice. They do have an 800 number for their "Securities Lending" department.

Also, I have some open short stock positions on stocks currently on the Hard to Borrow list. My understanding and experience is that if one is short the stock and then goes on the HTB list, that a recall notice is NOT automatic. Matter of fact, Schwab has told me that, although they have a legal right to recall the shorted stock, it is rare indeed that they do so.

Interesting exchange we are having here.

 

[dmo]

QQ, my experience with Schwab is that they are conservative to a fault - perhaps excessively so. I would guess their policies about borrowing stock are also on the highly conservative side - probably to avoid just the situation you mentioned where they have to force a customer to liquidate a short position.