Misplaced Pages

This is an old revision of this page, as edited by 216.230.150.7 (talk) at 19:28, 18 January 2006 (→More reading may help). The present address (URL) is a permanent link to this revision, which may differ significantly from the current revision.

Con naked short opinion:

(note: The next paragraph is from a book. Does wikipedia have permission to use this text?)

confusion

Most of this article is about short selling in general - the advantages, disadvantages, etc. In this it contradicts itself. On the one hand it claims that stability would be increased if naked short sales were allowed, as artificially ramping up a price would be countered by brokerages who would sell short. Later it claims brokerages can do that anyway. It tries to make the point that markets become illiquid and criminals can operate freely just because retail investors cannot naked short. Highly unsubstantiated. The disadvantage mentioned later has nothing to do with naked short selling, but short selling in general and should be mentioned there. The only points which are really about naked short sales are: the advantage that market makers have over retail investors (and this is listed under the advantages of naked shorting!), and the bit recently added about Regulation SHO (which is very much to the point). My suggestion would be to mention those bits to the general short selling under a seperate header. DocendoDiscimus 17:35, 6 October 2005 (UTC)

The content needs a revision. Yes. -- Svest 23:34, 10 October 2005 (UTC)

Merging with Short Selling

I think it's a good idea, but in the interest of giving people a change to discuss it, what do others think? --Jim Mulvey 16:48, 7 October 2005 (UTC)

I think that it is better for an encyclopedia to be expanded. I also think that this topic deserves an article by itself because it presents a different concept than of short selling or going long. The ideal scenario is to keep this article and add a brief section in the Short selling article, and add a (:Main article: Naked short sale) reference. -- Svest 23:27, 10 October 2005 (UTC)

Please explain in what way it is different from (normal?) short selling. - DocendoDiscimus 00:29, 11 October 2005 (UTC)

Hi DD. Short selling is the borrowing of a security in order to sell it and buy it later on at a lower price than the price it was sold short.

Naked short selling is selling and buying a security without borrowing any at all. No actual stock is borrowed and delivered to the purchaser, even though the purchaser pays the short seller. The investor believes that real stock has been delivered to their account. They are just non-existant shares, call it a counterfeit of a phantom security. Though the Naked SS has been illegal in the US since 1933, neither the stock exchanges nor the SEC impose any penalties. -- Svest 18:41, 11 October 2005 (UTC)

What you're describing is not naked short selling. When you agree to sell a security, then you are always obliged to deliver this on the date you've agreed (the settlement date, usually 2 or 3 days from trading). If you do not deliver, you are defaulting, i.e. the purchaser can take you to court for not fulfilling your obligation (though it hardly ever gets that far of course). Almost all security trading is by payment on delivery, so it cannot happen that the purchaser pays and does not get his shares. The only thing that makes a naked short sale differrent from any other short sale, is that when you agree with the purchaser to trade, you do not yet know where you're going to borrow the shares from. Also market makers always have to deliver on settlement date, but as that is usually a couple of days from trading, they can typically find the shares or bonds in time. - DocendoDiscimus 21:27, 11 October 2005 (UTC)

I think this article should be merged with naked shorting. --JLV 08:22, 26 October 2005 (UTC)

Title

I believe the title shoud read Naked short selling. Any comments? -- Svest 23:36, 10 October 2005 (UTC)

Yes, it should, and has been done. Shawnc 22:36, 21 October 2005 (UTC)

Thanks Shawnc. Great job. Svest 03:52, 22 October 2005 (UTC)

More reading may help

The Naked selling is a hot issiu. You guys must read this page before you make any changes http://ncans.net/ It stands for:'National Coalition Against Naked Short Selling - Failing to Deliver'--Miskaba 06:56, 13 December 2005 (UTC) Misoka

.................................... Warning this site WAS created by www.ncans.net penny stock promoters to further their fraudulent claim that worthless penny stocks they promote (James Dale Davidson, David Patch, Patrick Byrne,Mary Helburn,et al.) are victims of 'naked shorting'.The 'experts' cited,'Bob O'Brien' and Patrick Byrne of Overstock.com have an agenda and using Misplaced Pages to lend credibility to their penny stock scam and supposed 'anti-naked short selling stance is part of that agenda.

The truth is all the stocks they promote are questionable investments at 

best.ALL OF THE STOCKS THEY PROMOTE HAVE MADE DEALS WITH SCAMMY PENNY STOCK PROMOTERS SUCH AS THEMSELVES AND HIDDEN THEIR OWN 'FLOATS'(shares available in market to buy or sell) AS MUCH AS POSSIBLE WHILE THE INSIDERS TO THE SCAMS HAVE DUMPED THEIR WORTHLESS SHARES IN THEIR WORTHLESS SHELLS THAT THEY CALL 'COMPANIES'.Endovasc of Montgomery,Texas and Genemax(both incorporated in Nevada where stock fraud is the norm) that was promoted by James Dale Davidson through his Agora Inc. penny stock cyberfraud operation are just two examples.No Blue Chip stock companies have made any complaint of being 'naked shorted. THIS IS A SCAM.

Even 'famed trial attorney O'Quinn' has aided and abetted this penny stock fraud.Contact 'Bob O'Brien'(not his real name) of nacans.net, David Patch(ofinvestigatethesec.com),or Patrick Byrne of Overstock.com and request they and their followers stop using Misplaced Pages to promote their penny stock scam and fraudulent claim of 'naked shorting'.

I may be reached at endoscam@lycos.com. Sincerely Tony Ryals

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 wikipedia and naked shorting
 by: traderdan9891  01/12/06 05:41 pm
 Msg: 388624 of 388725

 http://en.wikipedia.org/Naked_shorting#Counter_criticism