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Non-Tech : Datek Brokerage $9.95 a trade -- Ignore unavailable to you. Want to Upgrade?

To: Jon Tara who wrote (7497)	3/24/1998 11:12:00 AM
From: bluejeans	Read Replies (3) \| Respond to of 16892

another way to help explain this is to use Jon's example, but go long instead of short. The amount to pay margin interest on will be the same as his example when going short. This makes the final result more logical to me. Bob

To: Jon Tara who wrote (7497)	3/24/1998 11:41:00 AM
From: Gorak Shep	Read Replies (1) \| Respond to of 16892

Jon, Datek is making you put up 100% collateral, not 50%. In Normile's example, you have to put up your $10,000 real cash PLUS $10,000 borrowed on margin for which you pay interest to collateralize a $20,000 short. Many other brokerages require only 50% but apparently not Datek. And both you and Normile say you don't get interest on the proceeds from the short sale since the stock sold wasn't yours. So who profits from those proceeds that is making some kind of money even if only sitting in some bank? Not the person who actually owns the stock sold. The brokerage does, of course, but they don't own the stock sold short any more than the short seller. Some brokerages split this interest with the short seller, at least for very good clients who demand it.