CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

Which of the following steps in the process of selling a stock short are FALSE?
A. The short seller gets the proceeds of the short sell.
B. The seller must inform their broker that the order is a short sale before completing the transaction.
C. The seller must borrow the securities from a broker before selling them and must return the securities at the request of the lender.
Explanation: Short sellers DO NOT get the proceeds of the short sell.

User Contributed Comments 4

User Comment
bidisha I thought by proceeds they meant premium.
birdperson what premium?
Noblebao i think this explanation needs an elaboration
krispy4 The proceeds are actually deposited in a margin account as collateral.
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