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Friction is the difference. Naked shorting removes the need to locate borrow. That need acts to prevent runaway supply expansion. Naked short selling also circu

Friction is the difference. Naked shorting removes the need to locate borrow. That need acts to prevent runaway supply expansion. Naked short selling also circumvents the rights of share owners as a class to decide whether to allow synthetic share creation.

ZephyrBlu 6y ago
Fair enough. I assumed that locating shares to borrow would be relatively easy.
- eru 6y ago
  Typically it is, but for heavily shorted stock, the fees go up.