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Microcap & Penny Stocks : Naked Shorting-Hedge Fund & Market Maker manipulation?
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To: rrufff who wrote (2723)8/21/2007 5:35:52 AM
From: rrufff  Read Replies (1) of 5034
 
How the options MM - quasi naked short - exception works as explained to an industry defender.

To: Jeffrey S. Mitchell who wrote (99987) 8/16/2007 3:11:19 PM
From: Patchie 2 Recommendations of 100051

A short seller Buys a Put which is a short position (Bet stock goes down). The Options Market Maker sells the Put which puts teh options market maker synthetically long. The Options Market maker then shorts the equity to hedge the synthetic long from the Put. The short seller can essentially short the equity, with the added leverage, by using the options market making exemption.
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