Replies to post #151792 on NSAV Holding Inc (NSAV)

[Xman1959]

How to Short Sell Penny Stocks
Say you’re ready to short sell. You’ve set up your margin account with a broker. And yep, you checked — they allow you to short sell penny stocks.

Now you gotta wait for the ideal setup.

To place a short, you usually sell the stock first. Some brokers have a dedicated ‘short sell’ button. This opens a negative position in your account.

Sometimes your broker might not have the shares. In that case, there’s nothing you can do. They might later in the day, so keep checking. But only short if your setup hasn’t played out yet.

Depending on the broker, you may be able to pre-borrow shares earlier in the day and short them later in the day (sometimes within a few days too).

You often gotta be quicker in taking profits when shorting than going long. There’s the risk of a squeeze after a dip, and you pay more interest the longer you hold.

So, do you short anything that seems overextended? Or short anything that’s starting to make new lows?

Nope. These are overly simplistic views of short selling that trip up many newbies.

[Xman1959]

Which brokers allow you to short OTC stocks?
This is not a good idea. Very few (maybe none) of the big name brokers will allow you to short OTC stocks due to the high risk potential to your account. OTC stocks are very thinly traded, which means that there is often no market other than through a market maker, i.e. a penny stock operation that keeps inventory of whatever OTC shares you are looking to buy or sell.