That is not how it works. The short seller has to confirm that they can deliver stock prior to placing the order. All they need to do is either call their lender and ask whether they will be able to borrow up to X shares if they were to sell them, or have a standing arrangement with a prime broker that up to X shares are always confirmed as available. Trading prior to settlement of the stock loan is totally allowed and is routine.
MFG Price at posting:
$19.29 Sentiment: None Disclosure: Not Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)