Thursday, April 22, 2021 6:11:50 PM
Here is the skinny on Shorting.
There are no set rules regarding how long a short sale can last before being closed out.
The lender of the shorted shares can request that the shares be returned by the investor at any time, with minimal notice, but this rarely happens in practice so long as the short seller keeps paying its margin interest.
A broker can force a short position to be closed if the stock rallies strongly, causing large losses and un-met margin calls.
It is far more likely that the investor will close out the position before the lender will force the position closed.
There are no set rules regarding how long a short sale can last before being closed out.
The lender of the shorted shares can request that the shares be returned by the investor at any time, with minimal notice, but this rarely happens in practice so long as the short seller keeps paying its margin interest.
A broker can force a short position to be closed if the stock rallies strongly, causing large losses and un-met margin calls.
It is far more likely that the investor will close out the position before the lender will force the position closed.
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