I’d also like to see people trade commodities only if they have the space to store them or have made a claim that they are directly impacted by cost of future commodities. It makes no sense that a hedge fund should influence the price of goods they would never use.
But in short, they decide to destroy a particular stock. They sell shares that they don’t have, and then when the stock reaches zero and is delisted, they do not have to provide the stocks that they sold but never had in the first place
Naked short selling
I’d also like to see people trade commodities only if they have the space to store them or have made a claim that they are directly impacted by cost of future commodities. It makes no sense that a hedge fund should influence the price of goods they would never use.
What are naked shorts?
Here’s a pretty good explanation
https://marketrealist.com/p/what-is-cellar-boxing-in-stocks/
But in short, they decide to destroy a particular stock. They sell shares that they don’t have, and then when the stock reaches zero and is delisted, they do not have to provide the stocks that they sold but never had in the first place
Imagine you cut a pair of shorts out of a pair of pants, then you throw the shorts away and wear the remaining pant legs.
Isn’t that already illegal? Just need to close the loopholes I think.
It’s happening constantly there’s no enforcement. They have invented all sorts of mechanisms to continue the practice.