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IB and the Ability to Borrow Stock for Short Selling
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IB and the Ability to Borrow Stock for Short Selling

  #1 (permalink)
Elite Member
Toronto Ontario
 
Futures Experience: Advanced
Platform: TradeStation and MultiCharts
Favorite Futures: ETFs
 
Posts: 17 since Nov 2011
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IB and the Ability to Borrow Stock for Short Selling

Hello,

I have been trading symbol VXX (Vix ETF) from both the long and short side. but in the last 2 days Interactive Brokers has 0 shares available to borrow. I find this shocking as VXX trades 5 million shares a day and $1.6 billion in assets. How could they not have 1 share available to borrow?

Last week there were millions of shares available to borrow.

Has anyone else experienced this with IB? What are some of the brokers with the best stock to borrow inventory?

Thanks

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  #3 (permalink)
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Thessaloniki, Greece
 
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Why not just go long one of the inverse ETFs?

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  #4 (permalink)
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I am not a fan of inverse of leveraged ETF. I would lilke to short the VXX.

Does anyone else find it odd that IB wouldn't have even one share of such a large ETF to lend?

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  #5 (permalink)
Identify Evaluate Execute
Mercer Island WA
 
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VanderTrader View Post
Hello,

I have been trading symbol VXX (Vix ETF) from both the long and short side. but in the last 2 days Interactive Brokers has 0 shares available to borrow. I find this shocking as VXX trades 5 million shares a day and $1.6 billion in assets. How could they not have 1 share available to borrow?

Last week there were millions of shares available to borrow.

Has anyone else experienced this with IB? What are some of the brokers with the best stock to borrow inventory?

Thanks

Hi. I don't trade the Vxx but is not uncommon for IB to have no shares available to borrow particularly for heavily traded leveraged ETFs. Have you looked at TD? It's a good alternative I use.

You should perhaps look at adding other instruments to trade. If I could find no borrow on one stock/Etf I'd move to another that did.

Cheers
DJ


Last edited by djkiwi; October 19th, 2012 at 03:44 PM.
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  #6 (permalink)
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Toronto Ontario
 
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Hi DJ,

VXX isn't leveraged and usually there are millions of shares available. Just this minute I checked again and now there is 2.6 million shares to lend. So for 1.5 days there was 0 shs to lend. How do they go from 0 shs to 2.6 million shares in an instant.

It just seems odd to me.

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  #7 (permalink)
Identify Evaluate Execute
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VanderTrader View Post
Hi DJ,

VXX isn't leveraged and usually there are millions of shares available. Just this minute I checked again and now there is 2.6 million shares to lend. So for 1.5 days there was 0 shs to lend. How do they go from 0 shs to 2.6 million shares in an instant.

It just seems odd to me.

I realize it isn't leveraged. I'm not sure if you noticed but there are also many other non leveraged stocks that are sometimes hard to borrow. The bigger issue for me has been some of the outrageous borrowing rates on some of the stocks if you want to swing trade them for a few days.

Cheers
DJ


Last edited by djkiwi; October 19th, 2012 at 07:41 PM.
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  #8 (permalink)
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DJ,

What king of rates you have experienced?

Thanks

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  #9 (permalink)
Identify Evaluate Execute
Mercer Island WA
 
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VanderTrader View Post
DJ,

What king of rates you have experienced?

Thanks

@VanderTrader, the borrowing rates are all over the map and can change rapidly as you have experienced with share availability of VXX. Did you know there is daily report you can download from IB that has the borrowing cost for every stock/ETF? Borrowing rates are more important if you are swing trading as they can eat into profits if you aren't paying attention.

Cheers
DJ

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  #10 (permalink)
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Toronto Ontario
 
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Hi DJ,

No I didn't know that. Where do I find that report?

Thanks

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