Shorted RFX... Hmm.. Now what?

Quote from tnewman1:

Well I was able to short RFX the day before it was halted. I shorted it late in the afternoon, the next morning, it never really opened.

I'm stuck now because the NYSE halted the stock. I have to call the brokers on this one because I've never been in a situation like this where the stock could be potentially delisted, or wiped out completely.

I shorted 1500 shares at 10.30 and would like to make a profit on the short side. I'm real curious to see if I hit a homerun or not.
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lol. do you think you did? the company is filing for bankruptcy. you cant be that stupid, can you?
 
Quote from areyoukidding?:

lol. do you think you did? the company is filing for bankruptcy. you cant be that stupid, can you?
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Actually I have never held shares in anything that was halted and filing for reorg ..... still dont.

That said, it seems that if you are short and you never get the opportunity to get filled on a buyback then you have made nothing..... but you borrowed the shares ..... who is holding the bag ? Unless you had an offsetting hedge it seems that you are not automatically OK ......
 
Quote from areyoukidding?:

if stock goes to zero, you never have to buy them back and never have to book the gain.
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..but did you automatically get the credit ? That is, how is the trade ultimately settled ?
 
Quote from areyoukidding?:

it just shows up as p/l. think about it, if you buy a stock at 10 and it goes to 30, you made 20, you dont have to sell it do you?
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it appears straightforward: I was thinking about the setllement ... if the broker had the shares to short originally then it should already be accounted for ...... guess I will have to revisit this scenario .....
 
Quote from tnewman1:

We'll see, I think I made some money but when this thing finally trades. I guess I got lucky, so far..
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I have an idea...
not sure how it would work but would be willing to find out.

You have shorts at ie 10..there are obviously traders that would be willing to exit there longs at X...
IF the stock is going to continued to be halted and you wish to exit ....I don't see why your broker will not do the internal trade for you...
If the broker is willing to place a ie bid/ask in the 5dollar range and the stock is still untradable in the open market I don't know of any law that would prohibit the two traders doing the trade...especially if you are both say via IB on smart route..

This obviously would be harder to do if both traders are at different brokers...but it can be done..

w
 
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