when i buy/sell a call or put option against a stock, my broker removes that amount of stock of the underlying security out of my 'tradeable' holdings. IE. i cannot be 'naked' selling a call or buying a put. why cant everyone be forced to play by that rule.
at the moment, effectively, there is limit of how much stock can be held (ie. the amount of shares on issue for any company), but no limit on how many shares can be short for any given company... that simply doenst make sense, because i can short an inifinite amount of stock until my short 'self fulfills' and the price falls....
OXR
oxiana limited
