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Re: leverage102 post# 40272

Thursday, 08/10/2017 5:17:51 PM

Thursday, August 10, 2017 5:17:51 PM

Post# of 61155
The site you listed may report sales as a "Naked Short" because a market maker may report a sale of shares that do not exist in their own accounts, but that doesn't make it a naked short.

Selling stock short without having located stock for delivery at settlement. This activity would violate Regulation SHO, except for short sales by market makers engaged in bona fide market making. Market makers engaged in bona fide market making do not have to locate stock before selling short, because they need to be able to provide liquidity. However, market makers are not excepted from Regulation SHO’s close-out and pre-borrow requirements.

Rule 204 overcomes any naked short selling that isn't carried above:

Rule 204 requires firms that clear and settle trades to deliver securities to a registered clearing agency for clearance and settlement on a long or short sale in any equity security by the settlement date or to take action to close out failures to deliver by borrowing or purchasing securities of like kind and quantity by no later than the beginning of regular trading hours on T+4 for short sale fails or T+6 for long sale fails and fails attributable to bona fide market making




My posted comments are only my considered opinion based on the reality as I see it. Your reality may be different.

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