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Posted On: 02/22/2020 3:09:32 PM
Post# of 36566
Creek, just read this. I’m going to contact TD and tell them I Want a Loan Exempt Restriction on my acct.
“Ask your broker for a Loan Exempt Restriction.
Note: This only applies to margin accounts. If have a cash account, your broker cannot lend your shares. “
“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 their shares lent out to other parties. (See also: Short Selling and the Margin Call.)”
“Ask your broker for a Loan Exempt Restriction.
Note: This only applies to margin accounts. If have a cash account, your broker cannot lend your shares. “
“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 their shares lent out to other parties. (See also: Short Selling and the Margin Call.)”
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Disclaimer: Of course, all of this is my opinion and you should not make any investment decisions based on my opinion. I have not received any non-public information.
