Why do people act like MMs dont naked short first learn what naked shorting is:
What is Naked Shorting Naked shorting is the illegal practice of short selling shares that have not been affirmatively determined to exist. Ordinarily, traders must borrow a stock, or determine that it can be borrowed, before they sell it short. So naked shorting refers to short pressure on a stock that may be larger than the tradable shares in the market. Despite being made illegal after the 2008-09 financial crisis, naked shorting continues to happen because of loopholes in rules and discrepancies between paper and electronic trading systems. https://www.investopedia.com/terms/n/nakedshorting.asp
Naked Shorting as a Market Function Some analysts point to the fact that naked shorting inadvertently might help markets stay in balance by allowing the negative sentiment to be reflected in certain stocks' prices. If a stock has a limited float and a large amount of shares in friendly hands, then market signals can theoretically be delayed inevitably. Naked shorting forces a price drop even if shares aren't available, which can it turn result in some unloading of the actual shares to cut losses, allowing the market to find the right balance.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.