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> I may have to review my own paperwork, because I don't recall giving permission to lend out my stock, or yielding my interest in related lawsuits. I've never
by jonknee 10y ago
> I may have to review my own paperwork, because I don't recall giving permission to lend out my stock, or yielding my interest in related lawsuits. I've never short sold, so I don't know how the agreement is intended to work. But if they're not on the hook legally, (which seems like they ought to be?) then it seems like it's up to the broker to make me whole.
The problem here is for the broker, not the person who owns the share. If they loaned it out that's their issue, you'll get your money. That's why the broker is the one making the money on loaning out short shares, they also assume the responsibility.
http://www.investopedia.com/ask/answers/05/shortsalebenefit.asp http://www.investopedia.com/ask/answers/05/shortsalebenefit....
> The main reason why the brokerage, and not the individual holding the shares, receives the benefits of loaning shares in a short sale transaction can be found in the terms of the margin account agreement. When a client opens a margin account, there is usually a clause in the contract that states that the broker is authorized to lend - either to itself or to others - any securities held by the client. By signing this agreement, the client forgoes any future benefit of having his or her shares lent out to other parties.