I hate it on IBKR when I get forced to cover a short due to my locate being arbitrarily recalled intraday. This happened on SATX recently. I want to be able to borrow stocks for definite terms of at least several days.
term borrowing of stocks
- Thread starter ScroogeMcDuck
- Start date
The system of stock loan doesn't work that way, but I would like to be proven wrong.
I am not sure the term arbitrarily in your context is correct .
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step 1: own 99% of the float of some scammy spac
step 2: hire stock promoters and/or wash trade with yourself to pump it up to absurd prices while lending out your shares for 1000% APR
step 3: force all the shorts to buy in at your arbitrarily large asks by recalling your shares
SATX in a nutshell
Almost every stock that's worth shorting becomes hard to borrow at some point.
step 2: hire stock promoters and/or wash trade with yourself to pump it up to absurd prices while lending out your shares for 1000% APR
step 3: force all the shorts to buy in at your arbitrarily large asks by recalling your shares
SATX in a nutshell
Almost every stock that's worth shorting becomes hard to borrow at some point.
Here is what you can do if the stock has equity options:
1) Buy a Conversion (way out of the money on the call side) and as long as you don't get assigned on the short calls (ie stock price stays below strike) then you have effectively borrowed the shares at a defined rate over a period of time
2) After you buy the conversion - you sell the shares when you want (leaving you with a short synthetic). Of course you could simply sell the synthetic as well.
An advantage with doing the conversion is that you can actually freely hit the bid (no down tick rule) as you own the shares. You will often see some large conversions being done prior to earnings announcements.
1) Buy a Conversion (way out of the money on the call side) and as long as you don't get assigned on the short calls (ie stock price stays below strike) then you have effectively borrowed the shares at a defined rate over a period of time
2) After you buy the conversion - you sell the shares when you want (leaving you with a short synthetic). Of course you could simply sell the synthetic as well.
An advantage with doing the conversion is that you can actually freely hit the bid (no down tick rule) as you own the shares. You will often see some large conversions being done prior to earnings announcements.