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Biotech / Medical : ImmunityBio converts from Immunomedics
IBRX 2.260-5.8%Nov 3 9:30 AM EST
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To: urslor who wrote (1066)6/5/2025 10:09:09 AM
From: erickerickson1 Recommendation

Recommended By
urslor

   of 1222
 
re: loaning out shares...

At one point SAVA shares were loaned out at an outrageous interest rate that Schwab and I split 50/50. There's a discussion on the IMMU board about that, the short form is that it's possible you won't get your shares back if the price spikes IIRC. If you carefully read the disclaimers, there's something about "we'll do our best, but we may not be able to get them back". This according to my aging memory.

You get something, but possibly not even close to the market value if it spikes hugely. So (again from memory) there's a small risk that a miracle happens and in the frantic reconciliation of all the short shares, you lose.

It's a question of whether you want to take this risk, and I admit I don't understand the mechanics, perhaps someone will be kind enough to explain. The weeds in the garden are calling, so I've got to get off the computer RIGHT NOW ;)

As I said, the Schwab agreement was that they'd split the interest with me. Couple that with them not being on the hook if they couldn't get your shares back and it looks like the subtext is that they make money, while you take the risk. So the brokerage telling you about how you can make money is a bit disingenuous.
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