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Microcap & Penny Stocks : FAMH - FIRAMADA Staffing Services

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To: Leroyt who wrote (14200)4/28/1998 5:22:00 PM
From: TraderGreg  Read Replies (1) of 27968
 
There are three theories here:

1. If a stock is in a margin acct, an MM can come and short it . I believe this is TRUE.

2. If a stock is in a cash account, it is exempt from MM shorting. I've heard both ways on this. But it is irrelevant because of 3. below.

3. If a stock is in cert form, it can't be shorted, i.e., naked.

3. is absolutely FALSE. In fact, naked shorting is the base case for certain stateside MMs and the mode of choice for slimeballs off shore.They rarely get in trouble doing this, as they're borrowing your car from the parking lot and returning it before you need it. Was it really stolen if you didn't know it was gone? See what I mean.

TG
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