Rman,
Andreas is correct 100%. You need $10,000 in buying power to short $10,000 worth of any stock. The credit is made to a special account that is associated with, but separate from, your regular margin account. Each subsequent day, your short position is "marked to the market," thereby either liberating additional buying power, or if you are less fortunate, consuming additional buying power.
By the way, some brokerages (very few, unfortunately) will allow the credit balance in the "special" account to accrue interest. Aufhauser was such a brokerage, before it was folded into Ameritrade. I know of no particular others with such a liberal policy, although I remember reading somewhere that they do exist. At the majority of brokerage houses, the credit balance accrues interest only for the broker, unless the client is sufficiently powerful to negotiate a better deal (read: institutional investor.)
Regards,
RB
P.S. IMO, Entremed is a no-brainer short, particularly after today's 7 point surge (options-expiration games?) Good luck. |
