4 ms·
At that point, the stock is worthless and the borrower doesn't have to return it. They keep all of the money from the initial sale.
by gmiller123456 4y ago
At that point, the stock is worthless and the borrower doesn't have to return it. They keep all of the money from the initial sale.
- eru 4y agoIt's a bit more complicated. Companies are often in limbo for a long time before they officially go under. The borrower has to keep paying borrow costs during that time. Which makes shorting companies that go down rather risky.