AEV 9.09% 1.0¢ avenira limited

short selling, page-34

  1. 48 Posts.
    I've got no problem with shorting - "buy low, sell high" is my motto - in no particular order.

    However, I would like to know whether the market is symmetrical with regard to leverage. What I mean is that aggressive shorting can be used to trigger margin calls, leading to distressed selling and a quick buck for the instigator. Is there a comparable mechanism on the long side? That is, if you have borrowed stock to short and there is aggressive buying which pushes up the price, does the lender trigger a margin call forcing the short party to buy?

    It seems to me that would be an important balancing factor in the market.

    Jim.

 
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