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Biotech / Medical : Biotechnology Value Fund, L.P.
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To: scaram(o)uche who wrote (3542)7/15/2003 5:40:03 PM
From: Biomaven of 4974
 
If true, what constraints are put on the NUMBER of shares that a convert holder can short?

I believe a convert holder is allowed to "naked" short as many shares as they have an option to buy. (Even if the option is way out-of-the-money and never going to be exercised in practice).

Of course I suppose a very sleazy short might show the same evidence that they held the convert to multiple brokers, so perhaps multiplying how many shares they can short. Or maybe these hedge funds produce such good brokerage business that their broker just takes their word for it how many shares they could cover by converting.

Peter
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