Brokers Won’t Tell You That Your Stocks are Being Loaned Out to Short Sellers

The reason most investors open a margin account is it is more liquid and easier to buy and sell stocks. This dupes the investor into opening a margin account that may devalue their holdings by allowing it to be loaned to short sellers.

In a margin account, when a stock is sold the funds from the sale can be traded right away.

In a cash account the investor has to wait three days for the sale to settle before the funds can be used again to trade. However, most investors do not realize the agreement they have signed in a margin account gives the broker control of the stocks to loan out to short sellers.

I have conducted a survey of many inventors in the stock market who invest because they believe in the USA’s record of excellent returns in the markets. I did not include speculators who short stocks or investors who hedge by straddles etc. Out of all the folks I asked, 100% of them said they would not allow their stocks to be lent out to short sellers. Most remarked they would have to be insane to bet against themselves by loaning out their stocks to be shorted.

Solution to Boost the Stock Market All investors in the USA to check with their brokers or mutual funds to find out if any part of their portfolio of stocks are being loaned to short sellers. If they do not want to help bring about the demise in the value of the stocks they hold by loaning them out to short sellers then close the margin account and only trade in a cash account. By starving the short sellers of stocks to borrow the stock market will rally back to Dow 11,000.

Point of Life Inc.

PO Box 7, 3032 East Commercial Blvd.

Fort Lauderdale

FL 33308

TEL/ 954-785-8439

About the Author

Michael was born in a poor district in Manchester, England on the 6th March 1945. After many life experiences and a very successful business career he retired to Florida in 1992. In 1998 Michael established Point of Life, Inc., as a vehicle to project his philosophy. The website www.pointoflife.com and the associated newsletter (Point Of Life Global Newsletter) are visited and read by thousands of people around the world every month. Michael is a frequent speaker on radio, television and at seminars where he shares and discusses his views about the purpose of life, finance and stock market investments, also living a healthy, stress-free life. His new book; Paradise Graces A Simple Mind, is now available from all good bookstores.

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