winr88 wrote: What a shareholder can do is tell his broker:
“I don’t want my stock loaned out, segregate it!”
And get it in writing.
This is what I’ve told my brokers:
“I don’t want my stock loaned out, segregate it.
Put it into an account that is not linked to any other account that has or could have any margin in it. If I don’t have such an account please set one up. Please confirm back to me by email that the stock is now in an account where it cannot be loaned. If you cannot do this for me right away I hereby demand physical delivery of a certificate representing my shares as soon as possible and shut down my account.”
It was a seamless experience and my broker did as I asked him. When I first did this, my broker stated he has never had anyone request that from him. He is one of the largest brokers at a firm that does some of the most lending. What a world we live in.
With the online brokerage accounts where one has margin, I am not sure what the solution is. Is this how the brokerage accounts subsidize their low trading fees?
Interesting thought that nobody has surmised this before.
‘Short & Distort’ is active in the resource sector because the industry has a heavy percentage of retail shareholders and they are being used by the industry. And the ‘Short & Distort’ crowd look to take advantage of the retail shareholders.
Not with this Alligator!
It’s the brokerage firms who are making a lot of money on this:
- Interest in the borrow,
- Commission on the short sale,
- Commission on the short cover and
- Commission on the shareholder selling in despair.
It’s a dirty secret in the business that nobody is talking about.
But I wanted readers to be aware of what I believe the situation to be and how best to protect yourself and your shares.
Regards,
Marin Katusa