Covering shorts on delisted stocks

Discussion in 'Stocks' started by Cutten, Sep 6, 2008.

  1. Cutten

    Cutten

    Has anyone been in this situation? If so, what are the mechanics of covering a delisted stock short or put position?
     
  2. Firstly, Congrats on your trade!!!

    Time to check the company website, your broker or contact the company to find out where they are not being traded (if at all)

    Hopefully it will not be a big deal to be able to close out through your broker as most brokers that focus on traders offer BB and Pink.

    Depending on the cost per share and the commissions you may end up with a large transaction component in your cost.

    Best of luck to you
     
  3. m22au

    m22au

    I agree with the previous poster, congratulations on the trade.

    If the stock is not trading somewhere (eg. on pink sheets), then you could

    (1) Choose to not cover at all

    and/or

    (2) Ask your broker for a worthless securities letter.
     
  4. If you never cover, one day it could strike oil and be worth 200 a share.