al
Member
The Gamestop fiasco, where hedge funds have been stung by a social-media-led squeeze has made the headlines. It is significant that the reaction of the regulators is stop trading rather than regulating shorting.
Apart from the sheer immorality of short selling, there are a few things I simply don't understand:-
a) The shares being shorted are "borrowed" from a broker, who doesn't own them. How is this even possible?
b) When the borrowed shares are sold to another person - who actually owns the shares at that point?
c) The whole scam relies on the person who bought the shares at the original higher price selling them back at a lower price. Why on earth would he do this?
Apart from the sheer immorality of short selling, there are a few things I simply don't understand:-
a) The shares being shorted are "borrowed" from a broker, who doesn't own them. How is this even possible?
b) When the borrowed shares are sold to another person - who actually owns the shares at that point?
c) The whole scam relies on the person who bought the shares at the original higher price selling them back at a lower price. Why on earth would he do this?