RE:RE:RE:My Prediction 2.0 Now I can't speak for Canada but there have been some securities in the US that have gone bankrupt and still were trading.
One was Tribune $100 bonds that after their bankruptcy went to .59 and I bought a nice bunch that after bankruptcy went as high as $28 way back when. Got a nice car out of it but it was a strange situation.
Then more recently we had Hertz. Actually after bankruptcy if I recall the stock bounced back. Also The General shopping centers. Then there was like GameStop but another weird situation.
So as far as I can figure, a short can still settle but of course this assumes there still is trading, which in the above instances there was, and of course pay back with virtually worthless shares but shares none the less.
What I learned, with the right company, legal and market situation, it still could be possible to make some nice money with bankrupt securities but of course with the right situation and circumstances. Given this the bounce back could be really, really big!