mom, Re: Locking up your shares.
Do we have to do it in writing or can we just call our broker? (I use scottrade)
Many people have requested a Loan Exempt Restriction by phone. The broker simply places a code on your margin account: "All securities are loan exempt." If there's ever any doubt, you can ask another broker to verify the restriction.
However, requesting the Loan Exempt Restriction in writing is always a good idea. Best to ask your broker. One broker said that they only accept fax requests which turned out NOT to be true.
ST: One poster said that ST told him that they didn't loan out shares. Wrong. If you're told that, ask to speak to a supervisor.
Friendly reminder: Don't loan out your shares.
The shorts are creeping back in again. If you lock up your shares, the manipulators are locked out. If you have a margin account, there's NO downside to requesting a Loan Exempt Restriction.
Ask your broker to put a Loan Exempt Restriction on your accout. No paperwork. No problems if broker is knowledgable (see below). Takes seconds.
I know everyone has heard about this, but if we ALL do it, it would dramatically decrease the shares available for market makers to short for their own accounts.
The process is painless.
A few days ago, I talked to a TDA rep and at first he pretended not to know the term "Loan Exempt Restriction." When I started explaining it, his memory was suddenly refreshed. He said the request can be made easily via phone: Call the regular TDA Client Services number - "please have your account number and PIN or UserID and password ready when you call" - 888-871-9007 -press 2 for Client Services and ask for the Credit Risk Dept. Simply request that they place a Loan Exempt Restriction on your account.
Update 1: Yesterday I called TDA to do the above and was told rather firmly by a female rep that this wasn't possible; that loaning out my shares was in the Hypothecation Agreement which I agreed to when opening my account.
Update 2: Being a junkyard dog, I tried again today. No problem. I simply pressed 2 to talk to a rep and he was happy to place a code on my account: "All securities are loan exempt." It took maybe sixty seconds.
I asked him if this was a hassle for TDAmeritrade and if he had a lot of requests for Loan Exempt Restrictions: "Not really a hassle. We probably make some money from loaning out shares, but we respect customer requests. We used to get a lot of these requests, but lately not so many."
So go for it (please). It may make a difference in the dramatic, out-of-nowhere, manipulative swings by the MM's.
OK,it can be done simply sending E-mail. Response from TDA:
Mr. xxxxxxxxx
Per your request, we have placed the Loan Exempt Restriction on your account ending in 7651.
If you have any further questions, please do not hesitate to reply to this e-mail, or call our Client Services department at 888-871-9007.
Best regards,
Elizabeth M.
Apex Client Services, TD AMERITRADE
Division of TD AMERITRADE, Inc.
AI
