Protecting good guys from bad guys?

Discussion in 'Trading' started by canmo, May 21, 2009.

  1. canmo


    Just got a letter from my broker 1 hour ago (not gonna advertise its name, but big enough) - it speaks for itself:
    Dear Client,
    Short Selling Restrictions
    Due to significant increases in the cost of borrowing stock in the underlying market, along with a lack of available shares to borrow, we have been forced to restrict short selling on the following US Shares:
    Ticker Instrument
    C (US) Citigroup
    RF (US) Regions Financial
    STI (US) Suntrust Banks
    KEY (US) Keycorp
    BAC (US) Bank of America
    FITB (US) Fifth Third Bancorp
    MS (US) Morgan Stanley
    PNC (US) PNC Financial Services
    WFC (US) Wells Fargo
    GM (US) General Motors
    F (US) Ford Motor Company

    Clients are not allowed to open any new short positions or increase any short positions in these instruments. If you currently hold an open short position, you are not forced to close this and if you need to sell in order to close a long position your order will be accepted.
    We will keep you updated with any changes to the situation.
    Of course, no conspiracy, honestly there are just "lack of available shares " for BoFA, GM , etc... ha-ha-ha... they gonna fail next week even without short selling , I bet... Somebody is really stupid to protect share prices this way - restricting shortseller like shutting rooster before dawn..
  2. AAA30


    Nothing wrong with saying what broker is doing this? I think someone else posted the same letter a while back would be interesting to see if another broker followed suit.
  3. canmo


    The broker is CMC Market.
    And the letter was good prediction for today - almost all of the tickers (8 out of 11) are down today, if we consider equal-weight short portfolio of all of them, it's about 3% profit right now.. Good shot, guys, specially for GM (-23.44% for now) , STI (-5.62%) , BAC(-2.89%), KEY(-2.76%), WFC(-1.92%), RF(-1.71%) - and all this with no short sellers... To be continued next Tuesday :) ..