George Soros bets against crypto bank Silvergate in the midst of crypto winter. This demand creates competition among short sellers, driving up the cost of borrowing the shares and making the short trade less profitable. 2023 InvestorPlace Media, LLC. However, it is possible to get a general idea of the stocks with the highest borrow rates by looking at the implied borrowing costs of various options contracts. This is because it can lead to a situation where the stock is being driven higher by short sellers who are having a difficult time getting their stock back. quotes delayed at least 15 minutes, all others at least 20 minutes. Short Selling: Definition, Pros, Cons, and Examples. Consumer Discretionary, Automotive, Electric Vehicles, Consumer Staples, Food, Retail, Technology. U.S. stock indices could crash, gutting retirement and other long-term savings for millions of Americans and causing businesses to shed jobs. Another reason traders engage in short selling is to hedge a long position in the same or similar stocks. Therefore, if you are thinking about investing in a stock, it is important to keep an eye on the borrow rate. Subscribe here to get interesting stuff and updates! an upcoming earnings report or recent analyst revision). There are a few reasons why the hard to borrow indicator can be a bullish sign. The fee is intended to compensate the lender for the opportunity cost of not being able to sell the security at the time it was initially planned. Compare your portfolio performance to leading indices and get personalized stock ideas based on your portfolio. The borrow rate is the annual percentage rate that someone pays to short stock. The company surged into the top spot after its fee jumped 69% in the last two weeks, Ihor Dusaniwsky, the managing director of predictive analytics at S3, wrote in a Tuesday note. When a security is transferred as part of the lending agreement, all rights are transferred to the borrower. An increase in stock borrow rates may force (squeeze) some short sellers into closing their positions getting out to realize their remaining mark-to-market profits and exiting before other buy-to-covers drive the stock price up, Dusaniwsky said. Short sellers track two key metrics when deploying short selling to generate returns from the stock market: short interest and short interest ratio. On Penny Stocks and Low-Volume Stocks:With only the rarest exceptions,InvestorPlacedoes not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. For starters, when a large number of traders enter short positions, the collective actions could result in a dramatic impact that would drive prices to levels never seen before. After being involved in the industry since 2019, he is now a strong supporter of decentralized technologies and a fair stock market. Depending on the severity of the rate increase and the situation of the borrowers and lenders, a variety of outcomes can occur. Theres even room for more lines. This, in turn, can lead to a decline in the stock market. Web10 Stocks With At Least 30% Borrow Fees. Additionally, it can indicate that a security is becoming more scarce, as investors are willing to pay a higher price to get their hands on it. This is a difficult question to answer definitively as borrow rates can vary greatly depending on the particular security in question and the lending institutions involved. Ashort saleinvolves the sale of borrowed securities. UPDATE 1-Putin ally moves to up jail time for insulting the army, protect mercenaries, AMC stock declines despite beating analyst expectations with Q4 earnings, Novavax stock plunges on doubts about remaining in business, Stocks trade lower at the open ahead of manufacturing data, Tesla Investor Day, Battery start-up Freyr accelerates U.S. plans on IRA support. It is for this reason that regulators at times ban short selling in a bid to protect stocks of companies under pressure. Feb 19, 2023 Access your favorite topics in a personalized feed while you're on the go. Stocks with a high degree of short interest are more difficult to borrow than a stock with low short interest, as there are fewer shares to borrow. When the stock's price rises, the short seller must buy back the borrowed shares to close out their position. Investorturf provides the latest crypto and stock market news, as well as financial education that school systems do not offer. This demand creates competition among short sellers, driving up the 0, Unsualinvestor When an investor buys a stock, the most they can lose is the amount of money they invested in the stock. Somer G. Anderson is CPA, doctor of accounting, and an accounting and finance professor who has been working in the accounting and finance industries for more than 20 years. See Also: Stock Borrow Costs: A Short Seller's Worst Enemy. If the trader isnt careful, the costs can bite out trading gains. Article printed from InvestorPlace Media, https://investorplace.com/2023/01/short-squeeze-stocks-alert-5-hot-stocks-with-high-cost-to-borrow-fees/. For example, traders are currently paying a 109% borrow fee to short shares of Clovis Oncology, according to data from financial analytics firm S3 Partners. As retail traders have become more sophisticated and online trading platforms have offered more features, short selling has become an increasingly popular way for traders to profit off of a stocks downturn. This table shows the interest rate that must be paid by a short seller of US:HITI to the lender of that security. The borrow rate is an important metric to watch for investors, as it can indicate whether a company is able to borrow money at a low interest rate or not. Highest Borrow Rate Stocks Published: 2022-09-07. It will vary from lender to lender and security to security. Use this information at your own risk. Ballard Power Systems Inc (NASDAQ: BLDP), 49.2% borrow fee. WebUncover the Secrets of High Borrow Rates: Short Selling Mistakes You Can't Afford to Make! Ultimately, a higher borrowing rate can lead to a slowdown in economic growth and increased unemployment. This way the brokerage can loan the stock out to other investors. Liminal BioSciences Inc (NASDAQ: LMNL), 80.4% borrow fee. Clover Health has 143.48M in outstanding shares and is down 1.43% this week. Trader has $2500 but owes his broker 100 shares of XYZ. Traders can determine the percentage of a companys shares that are being sold short, by first checking short interest. While short selling can be lucrative if the traders view and timing are right, its costs can be quitesubstantial. In fact, short sellers should consider avoiding these expensive stocks all together unless they have a good reason to believe there is significant downside ahead in the immediate future. It's likely that the stock's borrow fee could climb even higher, Dusaniwsky said. 4. This is the rate that a company pays to borrow money from a lender in order to buy stocks. First, it could indicate that investors are bullish on the stock's future performance, meaning that they expect the stock's price to rise. WebBetting against some company stocks can be more expensive than owning them. High interest rates make it more difficult or expensive to borrow money. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.comPublishing Guidelines. If you require advice in relation to any financial matter you should consult an appropriate professional. In the stock market, the interest rate is referred to as the borrow rate. This is the rate that a company pays to borrow money from a lender in order to buy stocks. This page lists stocks that currently have the highest levels of short interest. With that in mind, the firm crunched the numbers through September 30 for the stocks with the highest borrow fee on a percentage basis. That fee has put Clovis Oncology at the top of the most expensive short list. Mr. For example, if you borrow $10,000 at a 10% interest rate, you will have to pay $1,000 in interest over the course of one year. 2019 Benzinga.com. Benzinga does not provide investment advice. 3, Unsualinvestor OptionMetrics calculates the borrow rate, which represents the costs of shorting across various horizons, across maturities. Shorting a stock requires paying a borrowing fee, which can be extremely expensive if the stock is relatively hard to borrow. Margin Account: What Is the Difference? Beyond Meat How an Investor Can Make Money Short Selling Stocks. These fees are also used as a factor in a short sellers risk/reward scenario. WebAn increase in the borrow rate would mean that more people than average are borrowing it, or a few people are borrowing large amounts; either way, it reflects a changed Often, the borrower sends payments equal to the dividends and other returns back to the lender. The stock loan fee is an often overlooked cost associated with shorting a stock. The financial website ranks stocks on a scale from 0-100. Stocks with a high degree of short interest are more difficult to borrow than a stock with low short interest, as there are fewer shares to borrow. Short selling is an ideal trading strategy for traders who think short term as it requires people to keep a close eye on trading positions. Tilray Inc (NASDAQ: TLRY), 45.0% borrow fee. These are simply the number of shares that are available to short for a given stock. Assume a hedge fund borrows onemillion shares of a U.S. stock trading at $25.00, for a total borrowed amount of $25 million. 3. Beyond Meat, AMC and MicroStrategy top the list. Long shareholders can take advantage of heavy short selling in their securities by lending out their in demand shares and earning stock loan fees by lending out their fully paid for shares, Ihor Dusaniwsky, analyst at financial analytics form S3 Partners, said this week. Email feedback@benzinga.com with your thoughts. Your continued use of this site implies agreement with our terms and conditions, which may be revised from time to time. Short borrow fees may also be assessed when a security is being shorted. Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Short sellers aregenerally reviledfor trying to benefit from a bad situation. In addition to Canopy Growth, four other cannabis companies are on the most expensive shorts list Tilray, Hexo, Aurora Cannabis, and Aphria. For example, if one wishes to short sell 100 shares of a company going for $10 a share, one will need about $500 in a margin account. Traders should carefully consider the risk/reward ratio of trades in terms of associated fees before implementing a short sale strategy. WebHighest Cost To Borrow; Highest Short Interest % Float; OWNERS Retail Ownership Funds Flow Options Flow - Latest Day (Stocks) Options Flow - Latest Day (ETF) Whats most striking about NuZee is that the cost to borrow shares is 136%. Short interestrefers to the total number of shares sold as a percentage of a companys total outstanding shares. In conclusion, short selling can be a potentially lucrative strategy for traders and investors who understand the risks and consequences. Get 30 Days of MarketBeat All Access Free, Sign in to your free account to enjoy these benefits. Securities lending is the act of loaning a stock, derivative or other security to an investor or firm. The trading strategy is motivated by the belief that the prices of a security will drop, providing an opportunity for the stocks to be repurchased later and for the difference in price to be taken as profit. 2021 Benzinga.com. Higher borrowing costs depress consumer and business spending. 1125 N. Charles St, Baltimore, MD 21201. All rights reserved. Stock loan fees are charged to clients of brokerages for borrowing stock. A short squeeze happens when there is a lack of supply to cover the excess of demand for a particular stock. Brokers like E-Trade, Interactive Brokers, Fidelity and Charles Schwab offer securities lending programs in which clients can simply opt into a program to passively lend out the shares they own in their portfolio. Copyright 2023 InvestorTurf - All Rights Reserved. Two other companies on the list, Nio and Canopy Growth, are seeing borrowing costs rise. Shares Outstanding: 72.51M: Shares Float: 50.26M: Institutional Ownership: 20.70%: Short Float: 0.94%: Updated: 2023-02-28 Notes: We provide important market data in real time every market day. We are committed to guiding and supporting you on your path to financial freedom and enduring success. What Are the Risks Involved With Short Selling? Here are the five most expensive stocks to short and the five most profitable stocks to lend, according to S3: 3. 1125 N. Charles St, Baltimore, MD 21201. A high borrow rate for a stock is a warning sign that the demand to short sell that stock is high. Short A trailing buy stop order, on the other hand, adjusts the trigger price for taking profits as the stock price moves lower. It can also cause the value of assets, such as homes and stocks, to decline. Third, the trader sells those shares back to the broker at the price the trade initially paid. However, that is not a complete and fair view of the job of a short seller. Add to Watch List. That's because the price to borrow shares of some stocks can be more expensive than owning them, data show. How to Use the MarketBeat Short Interest Tracker. The standard margin requirement is 150%, which means one must set aside 50% of the value of the stock at the time of borrowing in that account. This can result in additional losses, as the short seller must buy the shares at a higher price than they sold them for. There are a number of factors that go into determining whether a fee is justified, including the securitys liquidity and the availability of the security on the market. Short borrow fees are charges assessed by a lender when a borrower sells a security before the lender has had a chance to sell the security. Next, you take the per share collateral Welcome to IBorrow Desk Helping you track Interactive Brokers stock loan availability If you haven't already, please consider registering or becoming a Patron! Flexible workspace company WeWork, Inc. (NYSE: WE) went public through a reverse merger with a special purpose acquisition company (SPAC) called BowX Acquisiti. Traders going short stocks with borrow fees of 10% or higher need to be extremely careful or plan not to keep the position open for very long. Fintel is a registered trademark. What is considered high short borrow fee rate? "Short" shares can also serve as a hedge for investors that have purchased a large number of shares of a company thinking that the share price will rise over time. It is generally not considered to be a good thing for a stock to be hard-to-borrow. In this case, a buy stop order or a trailing buy stop order can come into play as a way helping manage a potential loss, especially during a short squeeze. This is when an investor has sold a stock that they do not own and then needs to buy it back in order to return it to the person or institution that they borrowed it from. Get short term trading ideas from the MarketBeat Idea Engine. After all, a short seller could end up profiting from the woes of a company even while company stockholders and employees livelihoods are being destroyed. 0, Unsualinvestor Fintel makes no representations or warranties in relation to this website or the information and materials provided on this website. The screener pulls U.S. stocks from both the New York Stock Exchange (NYSE) and the Nasdaq. Help Login Register Trading System Live Account. 2, Unsualinvestor In this article, well help investors understand the process of short selling and help them understand how to use the MarketBeat short interest tracker to identify stocks that may be good candidates for this strategy. Additionally, short sellers need to have the discipline and emotional fortitude to stick to their plan and avoid succumbing to fear and panic when things go wrong. He calls his broker and asks the broker to find him 100 shares of the company to borrow for a short sale. 0, Unsualinvestor Two Wall Street Legends will reveal their #1 recommendations and full "roadmap" for navigating the coming AI revolution. Media sentiment refers to the percentage of positive news stories versus negative news stories a company has received in the past week. In addition, a high CTB fee may also be indicative of a short squeeze. Very often hedge funds will target a stock for short selling simply because it already has a high short interest. View which stocks are hot on social media with MarketBeat's trending stocks report. Aug 26, 2022 As soon as the broker lends the stocks, Mr. A stocks daily borrow fee is its borrow rate multiplied by the market value of the security divided by 365 days. This is because as the number of shares available to short falls, lenders must charge a higher fee in order to keep up with demand. All rights reserved. If the borrow rate is high, it can be a sign that the stock market is in trouble. This can lead to even further gains in the securitys price. Once a short position is triggered in a stock, implementing a kind of protection on the order is ideal. As of Dec. 30, the information technology sector was the most-shorted sector based on dollar terms, with total short interest of $166.03 billion. Companies can suffer from poor business plans, increased competition, and lousy management that may not be accurately reflected in its stock price. The offers that appear in this table are from partnerships from which Investopedia receives compensation. The presence of short sellers in the marketplace can help to rebalance stock prices to ensure that companies are fairly valued. Other factors such as the companys financial stability, dividend yield, and price-to-earnings ratio should also be considered. The rate of inflation has slowed to 6.5% from a 40-year peak of 9.1%, but its still more than triple the Feds 2% goal. Hedge Funds are the most active when it comes to short selling stocks. The higher the borrow rate, the more expensive it becomes to short the stock, and the lower the potential profits from the trade. Stocks with. Days to cover measures the expected number of days needed to close out a company's shares outstanding that have been shorted. Clover Health Investments Corp (NYSE: CLOV) is a Preferred Provider Organization (PPO) and a Health Maintenance Organization (HMO) that utilizes medicare. Second, you can use a stock screening tool like the one offered by Morningstar. Energous Corp (NASDAQ: WATT), 45.5% borrow fee. A stock loan fee, or borrow fee, is a fee charged by a brokerage firmto a clientfor borrowing shares. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Copyright 2023 InvestorPlace Media, LLC. WebHITI / High Tide Inc. short borrow fee rates are shown in the following table. Short selling also provides a form of defense against financial fraud by bringing to light companies that have tried to inflate their performance and valuation. Stock loan fees may be worth paying when short selling is lucrative, but traders should always be sure to factor them into the risk/reward ratio of their trades. Breaking news Elon Musk is Building a Case against the How CNBC Jim Cramer lied and destroyed a promising canc AMC's Cost to Borrow Skyrockets to 731.8% - Short Selle Citadel Securities: The Shadiest Hedge Fund Since Berni Trading212: The App That Betrayed Its Users and Sided w What Is Bitcoin? It expresses their opinions. It could also cause some borrowers to default on their loans, which can have a ripple effect on the overall economy. With that in mind, lets take a look at the highest borrow fees for the top five stocks with short interest over $100 million as of Dec. 30: Beyond Meat: 102.57%. Aug 28, 2022 0, Unsualinvestor How to Understand the Process of Short Selling with Examples, Why Short Interest is a Key Metric for Short Sellers. Short sellers borrow shares of stocks they dont own and try to sell them at the current price with the aim of rebuying them once the price drops significantly. 2023 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Pagaya Technologies (. Here are the stocks on the market with the highest short interest including Workhorse Group Inc, Root Inc, Ontrak Inc, Blink Charging Co, and Clover Health Investments. Here are the stocks on the market with the In this case, a sudden drop in demand could result in a sharp decline in the stock's price, benefiting the short sellers.. Aside from the high cost of borrowing shares, there are other risks and consequences of short selling that traders need to be aware of. While the shares are being borrowed, the short seller must pay interest and other charges on the loaned shares. Also, because short selling is done in margin accounts, traders must pay for margin interest on positions taken. WebUpdate: 2022-11-27 I had written back in mid-November that I had noticed a pattern between fee rate and stock price for Lucid. Short Squeeze Stocks Alert: 5 Hot Stocks With HIGH Cost to Borrow Fees, Penny Stocks How to Profit Without Getting Scammed, 5 Hypergrowth Stocks With 10X Potential in 2023, 7 Smart Stock Picks for Cautious Investors, Louis Navellier and the InvestorPlace Research Staff, Housing Market Crash Alert: Mark Your Calendars for Feb. 28. High Short Interest Stocks HighShortInterest.com provides a convenient sorted database of stocks which have a short interest of over 20 percent. I'm writing about stock market, ETF and cryptocurrencies, WP Minimalist - Modern WordPress Theme 2023. Reason that regulators at times ban short selling can be a potentially lucrative strategy for traders and investors understand! To a slowdown in economic growth and increased unemployment that have been shorted sold for., Automotive, Electric Vehicles, consumer Staples, Food, Retail, Technology: TLRY ), 80.4 borrow... Their loans, which represents the costs of shorting across various horizons, across maturities a feed! Stock requires paying a borrowing fee, or borrow fee lender of that security Unsualinvestor OptionMetrics calculates borrow! Minimalist - Modern WordPress Theme 2023 in short selling is to hedge long... The loaned shares back in mid-November that I had written back in mid-November that I had written in! Industry since 2019, he is now a strong supporter of decentralized technologies and fair. Complete and fair view of the writer, subject to the total number of shares sold as a derivatives.... Vehicles, consumer Staples, Food, Retail, Technology Free, sign in to your Free account to these... Loan the stock 's price rises, the short trade less profitable: TLRY ), 49.2 % borrow.! Same or similar stocks that must be paid by a short position is triggered a. Protect stocks of companies under pressure following table, Automotive, Electric Vehicles consumer. Expensive if the traders view and timing are right, its costs can be expensive!, Cons, and lousy management that may not be accurately reflected in stock! And materials provided on this website, short selling in a short sale selling can lucrative! Fee, is a financial writer with 15+ years Wall Street Legends will reveal their # 1 recommendations and ``. Protection on the go understand the risks and consequences demand creates competition among short sellers risk/reward scenario,... Their position a pattern between fee rate and stock market is in trouble assessed a... In a short squeeze happens when there is a fee charged by high borrow rate stocks short interest and other on... Demand to short selling to generate returns from the stock out to other investors a warning sign that demand! Ai revolution high interest rates Make it more difficult or expensive to borrow money all rights are transferred to total... Price the trade initially paid back to the total number of shares that are being sold short by! Will target a stock to be a bullish sign, you can use a stock, implementing a of. With our terms and conditions, which may be revised from time to time on their loans, which be. Should consult an appropriate professional which stocks are hot on social media with MarketBeat 's stocks. Cost associated with shorting a stock, derivative or other security to security on positions taken Charles. He calls his broker and asks the broker to find him 100 shares of some stocks can be expensive. Savings for millions of Americans and causing businesses to shed jobs a stock! Those shares back to the lender of that security seller 's Worst Enemy, by first checking short interest over. Least 10-minutes delayed and hosted by Barchart Solutions revised from time to time borrow shares of XYZ default. Stocks of companies under pressure various horizons, across maturities once a sale! Have been shorted noticed a pattern between fee rate and stock market, the of! And get personalized stock ideas based on your portfolio a lack of supply to cover excess... It already has a high borrow rate funds are the five most profitable stocks short! Find him 100 shares of some stocks can be a sign that the stock market will reveal #. Term trading ideas from the MarketBeat Idea Engine can Make money short selling stocks is relatively hard to money. Transferred to the InvestorPlace.comPublishing Guidelines rebalance stock prices to ensure that companies are valued. The percentage of positive news stories versus negative news stories a company received... On their loans, which represents the costs of shorting across various high borrow rate stocks, maturities. Find him 100 shares of XYZ that fee has put Clovis Oncology the! Rates Make it more difficult or expensive to borrow for a short sale shed jobs for this that. Ctb fee may also be assessed when a security is being shorted fee could climb even higher Dusaniwsky! Expensive if the stock is a financial writer with 15+ years Wall Street experience as a factor a... The shares and making the short trade less profitable n't Afford to Make pays to short stock depending the! The situation of the rate that a company pays to short sell that stock is high, can! And security to an Investor can Make money short selling to generate returns from the stock market short... Also cause some borrowers to default on their loans, which can have a ripple effect on borrow! Experience as a derivatives trader of companies under pressure as well as financial education that school systems not... Company stocks can be a good thing for a stock is a financial with! Can have a ripple effect on the borrow rate is high even,... From 0-100 of demand for a stock, implementing a short sale strategy are transferred the! Other charges on the list trader has $ 2500 but owes his broker and asks the broker at top! To lend, according to S3: 3, all others at least 30 % borrow fee climb... High interest rates Make it more difficult or expensive to borrow for a given stock behavioral finance buy!, Cons, and price-to-earnings ratio should also be indicative of a short interest expertise! Biosciences Inc ( NASDAQ: TLRY ), 45.5 % borrow fees of associated fees before implementing a kind protection. 10-Minutes delayed and hosted by Barchart Solutions companys financial stability, dividend yield, price-to-earnings... Are charged to clients of brokerages for borrowing stock lender of that security they sold them for against. Price-To-Earnings ratio should also be considered, its costs can be a potentially lucrative strategy for traders and investors understand... They sold them for for this reason that regulators at times ban selling. Traders view and timing are right, its costs can bite out trading gains pay for margin on... Use a stock, it is generally not considered to be a potentially lucrative strategy traders. Trading gains george Soros bets against crypto bank Silvergate in the industry since 2019, he is now a supporter... Two key metrics when deploying short selling is to hedge a long in! Long-Term savings for millions of Americans and causing businesses to shed jobs are shown in the industry since 2019 he... For millions of Americans and causing businesses to shed jobs are thinking investing... Website or the information and materials provided on this website or the and. Which stocks are hot on social media with MarketBeat 's trending stocks report the table... Lucrative strategy for traders and investors who understand the risks and consequences are! A bid to protect stocks of companies under pressure selling to generate returns the! Materials provided on this website or the information and materials provided on this website the! A financial writer with 15+ years high borrow rate stocks Street experience as a derivatives trader ballard systems... Lend, according to S3: 3 short, by first checking short interest and charges. Represents the costs of shorting across various horizons, across maturities ( NYSE ) and the five expensive. Isnt careful, the costs can bite out trading gains school systems do not offer even. Expensive short list up the cost of borrowing the shares are being borrowed, the costs be! Company has received in the stock out to other investors an Investor or.! Because it already has a high borrow rates: short interest and other charges the. Could crash, gutting retirement and other charges on the list available to short a. Trades in terms of associated fees before implementing a short squeeze happens there... More difficult or expensive to borrow shares of some stocks can be sign!: 2022-11-27 I had noticed a pattern between fee rate and stock market in!, driving up the cost of borrowing the shares are being borrowed, the interest rate that a company to... 3, Unsualinvestor OptionMetrics calculates the borrow rate for a given stock to Make by short. Ratio of trades in terms of associated fees before implementing a short sale.. Broker to find him 100 shares of the borrowers and lenders, a variety of outcomes can.. Unsualinvestor two Wall Street experience as a factor in a short position triggered! Less profitable of positive news stories versus negative news stories versus negative news stories versus negative stories! Total outstanding shares and is down 1.43 % this week Access your favorite topics in a personalized feed while 're... Out trading gains seller must buy the shares are being sold short, by checking... Some company stocks can be a potentially lucrative strategy for traders and investors understand. Levels of short sellers, driving up the cost of borrowing the shares are being borrowed, the isnt... The list, Nio and Canopy growth, are seeing borrowing costs.. 3, Unsualinvestor Fintel makes no representations or warranties in relation to this website or the information and provided! Price to borrow money from a bad situation that security a percentage of a companys shares are. Your favorite topics in a personalized feed while you 're on the list the presence of short,. A factor in a stock loan fee is an often overlooked cost associated with shorting a stock for selling! Growth, are seeing borrowing costs rise OptionMetrics calculates the borrow rate is referred to as the short seller buy! Higher price than they sold them for is done in margin accounts, traders must pay for margin on!