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petermic

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petermic

Re: Red Knob post# 26458

Friday, 06/01/2012 11:47:18 AM

Friday, June 01, 2012 11:47:18 AM

Post# of 221960
With regard to shorting low priced stocks, keep in mind that the minimum (per the Federal Reserve) margin required is $2.50 per share. Most brokers use $5.00 per share.

This makes shorting most penny stocks uneconomic.

Another factor is the 'rebate' or fee to borrow the stock which most brokers, including IB, charge. That varies and can be well in excess of 100% per year.
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