% | $
Quotes you view appear here for quick access.

InterOil Corporation Message Board

  • j.coolaid j.coolaid Mar 1, 2013 11:22 AM Flag

    are shorting shares UNLIMITED??

    answer is NO! Clearly we have naked shorting happening on a massive scale in IOC...My view, but virtually GUARANTEED that is happening...What ya expect from crooks though....

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • it's happening on a grand scale guaranteed!!!!!!!!!!!!!!!!!!!!!!!!!!! Crooks out in force..trapped like the slime of a burbot while shorting more NAKED....working for them in the short term..SEC is incompetent at doing its job..

      • 1 Reply to j.coolaid
      • Coolaid, I'm going to be nice here.

        The answer is that yes, in theory, shorting can be "unlimited" but it takes time. If I legitimately borrow shares, from say Kenny, and sell them to you - you own them free and clear. You in turn could loan those shares out again, say to me, and I could sell them back to you again, and so on. It's pretty straightforward and one of the reasons why true short squeezes are so rare.

        You can also confirm that naked shorting isn't much of an issue - if you think about it logically - if someone sells a share "naked" (i.e. without borrowing), then the buyer (say you) won't be delivered the shares. Obviously you would have a huge problem with that, right? It's know as a Fail-To-Deliver (FTD), and all FTDs are reported to the SEC and made public on a daily basis. If FTDs get out of hand then a stock automatically goes on the "Reg SHO" list which implements a temporary uptick rule - and thus "naked short attacks" are nipped in the bud. IOC is not on that list but I think STP has noted it was on there back in 2008 or so.

        So while it's certainly reasonable to speculate that legitimate short selling may contribute to a particular price move, the "Naked Short" stuff is pretty much BigFoot at this point.

        Perhaps you can take me off ignore to learn something once in a while.

        Sentiment: Hold

49.00+0.11(+0.22%)Aug 23 4:02 PMEDT