Short borrowing costs

K

kj5159

I have an account with TD, I called the trade desk to ask what the fees for shorting LYFT are and the guy told me there are no fees and no margin interest is charged......not sure where to go from here to figure out what the fees are.
 
Am I completely insane or are there usually margin/borrow fees involved in holding a short? Tell me I'm not crazy. Maybe he just said there are no fees because he said they don't have any available to short...I dunno. I just read some articles talking about how high the borrowing rates are...and this guy says there are no fees....Mind is blown right now.
 
I put a locate in for Lyft right after I read your post. Was very surprised that it came back with a zero rate as well. Confirmed by our back office.

When I look at the options prices it appears they also are using a zero rate.

Note that normally you receive a rebate when you short a stock. Paying for the short is reserved for hard to borrow stocks.
 
FSU said:
I put a locate in for Lyft right after I read your post. Was very surprised that it came back with a zero rate as well. Confirmed by our back office.

When I look at the options prices it appears they also are using a zero rate.

Note that normally you receive a rebate when you short a stock. Paying for the short is reserved for hard to borrow stocks.
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But it's one of the most shorted stocks out there right now...no shares available...isn't that the definition of hard to borrow? How is this happening?

May I ask which firm you work at?
 
kj5159 said:
But it's one of the most shorted stocks out there right now...isn't that the definition of hard to borrow? How is this happening?

May I ask which firm you work at?
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Clear through Apex, they are providing the short.
 
kj5159 said:
I have an account with TD, I called the trade desk to ask what the fees for shorting LYFT are and the guy told me there are no fees and no margin interest is charged......not sure where to go from here to figure out what the fees are.
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%%
Sounds like they told you the truth;
+no dividend for YOU to pay.I assume you're out @ end of day; not likely they loan you money @ zero%, for swing/position trade.:cool::cool:
 
kj5159 said:
Yeah I get if there's nothing for day trades but overnight I'd imagine it's very steep...
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You don't pay for short stock when day trading. Currently there is no charge for holding overnight either.

Even if you don't pay for short stock, you are still "paying" when you don't get a short stock rebate. When you short a stock, you generate cash which should earn you interest. If you don't get this interest, you are essentially paying a fee to short the stock.
 
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