Short selling and locates

Shorting needs borrowed shares

To short a hard-to-borrow stock, your broker must first find shares for you to borrow: a locate. Easy-to-borrow stocks need no locate. What the desk can do depends on your broker; a broker without a locate service in the desk says so here.

The LOCATES window

The LOCATES window lists the scanner's top ten, with your broker's borrow status, easy or hard to borrow, and the locate price per share. Type any symbol and press ADD; REFRESH asks again for every row. Quantities are in lots of one hundred, and BUY always asks first, with the total cost. The BROKER window shows whether the selected broker needs locates.

Your locates

YOUR LOCATES lists the locates you hold today. Where your broker allows it, SELL sells unused locates back, and SYNC reads the locates your broker says you hold.

Seen everywhere

Locates you hold show on the scanner, in the Loc column, with a dark red row, The Loc column shows how many you hold for that stock today, and a dash means none. Check that column before you short a stock. and on the SHORT button's second line. In the AUTO/BOT window, Locates for armed lets you record locates you got elsewhere.

Paper and live

In paper, prices are shown and nothing is bought: paper shorts need no locates. Live, a short the broker refuses for borrowing opens a window that explains why, and the refusal is written in the order log. On a live short, the automation's size is also capped by your locates. Try a short in paper first, and remember that live needs a locate for a hard-to-borrow stock. Paper shorts need no locates, so the practice never waits on one.