Maybe someone has not properly explained how "shorting" works. Many have attempted to do this and failed. I'll also have a go so that you can understand why it is legal. The biggest problem with "shorting" is that too many don't understand that there is NO magic involved involved in the process. So here goes maybe an explanation that you and others can understand: Example: Jim buys 1000 PLS shares. Peter comes to Jim and says that he(Peter) want to enter into a contract with Jim for the following: Jim is to transfer his 1000 PLS shares to Peter(nothing illegal here). Peter pay Jim an agreed amount of money until such time as Peter transfers 1000 PLS shares back into Jim's name. (Nothing illegal here). Once Peter has ownership of the shares after it was transferred to him by Jim, Peter is free to do with the shares as he wishes(Peter is now the owner) and sells the shares.(nothing illegal here). When the agreed time comes round to transfer the shares back to Jim, Peter buys 1000 PLS shares and transfers the 1000 shares back to Jim(nothing illegal here). At the end Jim has his 1000 PLS shares back plus the amount that Peter agreed to pay him for "borrowing" his 1000 shares. Peter has made either a profit or loss by selling the 1000 PLS shares and then buying them back less the fee he agreed to pay Jim for borrowing the shares. Now Jim has his 1000 shares back and is free to hold or sell the shares as he sees fit. Based on the above, who would you blame if the share price is higher or lower than at the start of the above process? Is anyone guilty of a crime?
PLS Price at posting:
$3.94 Sentiment: None Disclosure: Not Held
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