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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Grommit who wrote (30151)	2/22/2008 3:22:14 PM
From: robert a belfer	Read Replies (1) \| Respond to of 78744

<ACAS -- I just got a letter from schwab where they want to borrow my ACAS shares and pay me 2% annual interest rate on the market value of the shares. I lend the shares and get the 2%. They get the dividends but schwab pays be an equal amount in lieu of dividends. But since that is taxable at regular tax rates, schwb pays an additional goodwill amount to cover the tax. But the securities get moved to a new account which is a hassle. And I get a letter of credit since I lose SIPC protection. I never heard of such a thing. I see no downside. Any comments?> Snail or e mail? I have some ACAS at Schwab and have not seen that.

To: Grommit who wrote (30151)	2/22/2008 4:48:19 PM
From: Bart Hoenes	Respond to of 78744

This is something I've never heard of. <edit> Interesting reply from B.K.Myers above. Sounds like you could earn some extra $ from this...

To: Grommit who wrote (30151)	2/22/2008 7:10:18 PM
From: Madharry	Respond to of 78744

I remember hearing some of the stuff about the naked short selling and how they avoid getting caught. If i recall this correctly all they need it is to show that they have possession of the shares for some point during the day and they are covered. I gathered from this that in actuality the same share could be shorted several times if used by multiple short sellers. Perhaps schwab has figured out the this can be a lucrative side line for them. if not i cant see why they would go to all this trouble. i also wonder why they need to put this in a separate account unless they want to avoid some type of audit that might uncover this. I guess its my training as a credit officer.