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As an investor I would rather an actual share, than a promise. They are not fungible to me. Even disregarding the risks, an actual share comes with voting right
by im3w1l 6y ago
As an investor I would rather an actual share, than a promise. They are not fungible to me. Even disregarding the risks, an actual share comes with voting rights.
- eru 6y agoWhen you buy a share, no matter whether from a short seller or anyone else, all you get immediately is a promise. The actual share gets delivered 2 days later, and it doesn't matter whether who you bought from, short-seller or otherwise. Your voting rights are exactly the same. You are right that replicated shares with options and other derivatives usually does not come with voting rights. That's true. The market price for voting rights on individual shares is usually miniscule. But non-zero.
- im3w1l 6y agoI read you as saying that (indefinite) naked short selling should be allowed, meaning that the buyer doesn't get a share after 2 days, or ever. I wonder what the value of short term naked short selling would even be? In that timeframe borrowing should not be very costly anyway? The GME shorts have been short way longer than 2 days.
- eru 6y ago> I wonder what the value of short term naked short selling would even be? First, to put everyone on the same footing as the market makers. Second, just to make short selling easier in general. Short sellers are massively important to spots bubbles and other asset mispricings, but they never get any love.