Short sale question TSLA

Discussion in 'Stocks' started by nursebee, Sep 29, 2012.

  1. nursebee


    I follow Tesla and the following was published on one of there forums:

    Short-sellers must to borrow shares and pay interest to short them. Since there aren't enough shares to go around (too many bearish investors who don't know the real story), the interest rate has surged in recent weeks. Fidelity Investments, a market-maker in this arena, is currently paying 17% on loaned Tesla shares. It would be most satisfying to make the claim that Detroit auto execs betting on Tesla's failure have financed the purchase of a Model S. I am attempting to do just that.

    I have never heard of owner of a stock getting paid for loaning out shares for short sales. Have any of you? If I changed brokers with my shares would they pay me this 17%?

    My guess is that this is not the kind of thing that makes it to me the retail trader.
  2. Depends on your account size and broker -

    As far as OLBs for us small guys I think only IB and Schwab offer some kind of return when they lend your shares out - I believe that shares held in IRAs are considered cash accounts and shares are not lend-able, but who knows - I've gotten different answers on that in the past.

    ^Everything I wrote might be wrong ~ I'd love someone to give a better answer then my own.
  3. the whistling leaf is correct re most retail accounts not getting lending fees. your broker keeps 100% of them in almost every case. if your account is a margin one that is. if you really want to stick it to your broker, change your account to cash so your shares aren't lendable as the leaf said.

    bottom line - just ask your broker if they'll pass on some of the fees to you - no broker passes on all of the fees even for institutions. the worst they can do is say no.
  4. is that true that Google is the shareholder of TSLA?
  5. Banjo


  6. jencoop


    Foreclosures lower the price of homes and prevent the recovery of the market. Sadly, there is apparently no shortage of foreclosures on the horizon. A recent report by RealtyTrac, a web-based marketplace for foreclosure properties, indicates that more than a quarter of all property sales in the U.S. are foreclosures. Along with last week's dismal jobs report, the data reinforces the picture of an already-sluggish economic recovery continuing to tap its brakes.
  7. Maverick74


    Can't believe this spam bot bumped this thread of all threads. LOL. I was actually looking up the option prices to spot the arb but this thread is a year old.

    While I'm here, you guys CAN earn lending rates through the reversal. It has to be priced in and anyone can put the trade on.