LogFAQs > #950015851

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Topic	Stock Topic 16
red sox 777 01/28/21 11:59:07 AM #241:	Sunroof posted... A coworker was telling me that the reason these platforms are restricting trading is to protect themselves for when investors lose money and want to sue them.... Makes no sense but lets add it to the fray! That's what they say but I think my theory is much more plausible. If they have a margin requirement of 100%, what do they do when a short loses 1000% and they can't close the position in time? The brokerage eats a loss of 800%.....I dunno how many people at non-prime brokerages are shorting, but even with a pretty small number, that could be very very expensive. --- September 1, 2003; November 4, 2007; September 2, 2013 Congratulations to DP Oblivion in the Guru Contest! <cite>red sox 777 posted [p:950015851] in Stock Topi... [t:79264244]...</cite> <quote>Sunroof posted... </cite> <quote>A coworker was telling me that the reason these platforms are restricting trading is to protect themselves for when investors lose money and want to sue them.... Makes no sense but lets add it to the fray!</quote> That's what they say but I think my theory is much more plausible. If they have a margin requirement of 100%, what do they do when a short loses 1000% and they can't close the position in time? The brokerage eats a loss of 800%.....I dunno how many people at non-prime brokerages are shorting, but even with a pretty small number, that could be very very expensive. --- September 1, 2003; November 4, 2007; September 2, 2013 Congratulations to DP Oblivion in the Guru Contest!</quote> ... Copied to Clipboard!
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