I just cannot, for the life of me, understand how you make a profit by it.
In: Economics
I undestand the princible and how the profit comes from it but I do not understand what is the gain/why bother?
I you have such clayorvance how the market will go, then might as well do options?
Seems to me the winner is the stock borrower who covers their stock decrease with the premium gained from borrowing?
The only applicable scenario I would understand is straight up market manipulation? But why would the stock borrower want have their stock value reduced possibly for long time?
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