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Shorts Against Teslas Stock Lose More Than 1 Billion

adiggs

Active Member
Sep 25, 2012
4,831
14,257
Portland, OR
Is this a paper loss, or a for realz margin call pay up now event?

When you sell shares short, you deposit cash at the end of each day equal to the closing price of the stock. So the losses are paper in that they aren't taxable, or tax deductible and the position is still open. They are for realz in that they are marked to market every day in the form of cash. If you're short and you don't have the cash, your broker will force liquidate you, and they won't be tardy about it (because THEY are also on the hook for your loan).
 

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