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$6.13 orocobre limited

. . And if none of them did it, all of them would perform better.

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dyeman

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166

13/12/18

15:36

Post #: 36849625
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Originally posted by Quiono ↑

Originally posted by SpaceWalker
They may be acting on behalf of a fund manager who bought the stock and settled. In a cash account the custodian cannot lend out customer shares as he is only providing settlement services and safe custody to client for his investment in the company stock. He can lend out shares only if the custody agreement explicitly provides that he can lend out customer shares. Normally fund managers do not agree to this clause.

When you open a margin account with a broker they are free to lend out your shares even if you bought them for 100% cash as they have given you a credit line against the shares and hold indirect title to the shares.
Almost spot on, except for the part where you say most fund managers don’t agree to lend out their stock. Most of them do agree. The fees received are offset against the
Prime brokerage costs of the custodian. If fund A agrees, and fund B doesn’t, fund A will outperform even with an identical portfolio. That is why they do it.

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. . And if none of them did it, all of them would perform better.

ORE Price at posting: $3.99 Sentiment: Hold Disclosure: Held
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