You're right. You can short pennies, it just is risky and can make your account go negative. Also some brokers require your account to cover the shares with $2.50 a share you want to short just for this reason. My buddy is a stock broker, and there are tons of threads about this through a simple google search.
And what would the margin requirement be for you to short, say $400 worth of SRGE? I'm thinking you would have to put up $100,000 in collateral.....100k shares at 1.00 a share......
Yup, that's really quite the return on equity, right? Guffaw.
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