Sorry, sir, but if you are talking about stocks listed on the NASDAQ or the NYSE, you may be incorrect. Each clearing firm has their own guidelines about whether or not to make a stock marginable. All brokerage firms have their own rules as well. Price limits for marginable stock (and whether or not the stock can be margined at any price at all) are set by brokerage firms...and yes, they must be margined in a Type 2 account and shorted in a Type 3 account, as opposed to a Type 1 (cash) account.
The broker I use for day trades allows stocks to be margined above a certain price, but the firm they clear through has a lower limit. Thus, I cannot short a stock if it is below my broker's price limit, even though it is above the clearing firm's minimum price limit for margin. Every firm makes their own rules.
Another related example: up until about a year ago there was a rule that nobody could short an IPO within a certain number of days after it went public. That rule has changed, and it is now possible to short a stock on the day it goes public under certain circumstances.
In my humble opinion, anyone that day trades BB stocks deserves what they get. Just my opinion. I personally would hate to see this thread decompose into debates about the fine art of day trading BB crap...there is plenty of crap to trade on the real exchanges in any case.
These little debates could be easily settled if people would simply reference the applicable laws or regulations, if any. Unfortunately your broker may not have the true data, and the person at your clearing firm may not know what is going on either.
This thread is a forum for helping people learn. It would be better for the rest of the people here if you post the pertinent information/laws/rules etc. and we'll all learn.
OK?
If I am yapping about stuff you already know, I apologize.
Thanks in advance. |
