The Stock Exchange Business a Course of Study With References
The Stock Exchange Business a Course of Study With References
Investment Bankers Association of America Educati
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Norton, 35-41. Economic services rendered by short selling in the security market: Discounting function of the market facil- itated. Steadies prices at all times. Resists excessive inflation and checks un- warranted declines. Owners of securities, unable to deliver at once, may nevertheless sell and borrow for purposes of delivery. Makes possible the hedging of a dangerous market position. [41] Operations of "odd-lot dealers" greatly facilitated. Operations of "Specialists" greatly facil- itate...d. Arbitraging between different markets made possible. Arbitraging in "rights" made possible. Owners of "rights" may dispose of same by selling short an equal amount of old stock. Arbitraging in convertible securities made possible. Continuous character of the security mar- ket greatly increased. Huehner, 15-17. Van Antwerp, 78-82, 420- 21. (With reference to this topic, also see Chapter on "The Short Sale" in Huebner: "The Stock Market". ) Question i. On March i, a customer orders his broker "X" to sell short for him on the New York Exchange, regular way, 100 shares of a certain stock at ^75 (par value of shares $100), and the order is executed at this figure.
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