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Mark102

08/03/20 1:14 PM

#27565 RE: TenKay #27560

short seller who doesn't buy back the stock before bankruptcy may have to wait until the company is liquidated to take a profit but never has to pay back anyone.
However, the short seller owes nothing. That is the best possible scenario for a short seller. Eventually, the broker will declare a total loss on the loaned stock. At that point, the broker cancels the short seller's debt and returns all collateral.