That is true. A few years back etrade actually called me to ask if I would loan out my shares Some here might remember the story.

"Hey, we'll pay you interest. You make money!"

How dumb. I let her have it. I think she knew what was coming and heard it 100 times. Why would I want to make a fraction on interest and lose a fortune helping someone short the company I own? Makes no sense. Some do fall for it. They don't realize the short attack period can be days so you aren't making that much in that time frame. etrade had a lot of nerve asking me.

What also was discussed here a few times is about putting a very high sell order in for your shares. What was interesting about that is at least with etrade, they canceled all of mine a few years ago. Said it was to far out of range. What was odd was, there never was the case before. I haven't tried it in a while. I didn't have it crazy out of range. Maybe $10-$20 higher. Not like I put in a million dollars.

The bottomline is...

If you don't want your shares loaned out, make sure they are not in a margin account. If they are in a margin account, then a high sell order may lock them up.