Can You Margin Fas/faz At *your* Brokerage?
Q: Hey dudes and dudettes, just a quick survey question here. My brokerage does not allow you to buy anything under $4 on margin; you have to put up 100% of the money, in other words. In the case of FAS and FAZ, if they're between $4 and $5, you've got to lay down 90% - not cool. Eventually these things, because of the decay they experience, are going to zero. Just look at where FAS/FAZ were at the beginning of the year and where they are now - they were in the 20s/30s in January, IIRC, and are both in the single digits now. I gotta switch brokerages so I can keep riding the FAS/FAZ train, I do believe. So who out there does not impose these lame limitations on margin (or at least less strict limitations)? I read some dude here, with daytrading powers I guess, was buying FAS/FAZ with 4x margin. Insane! (Think he may have been with E-Trade, lol.) What about the rest of you guys, which brokerage and what (if any) limitations do you have on buying FAS/FAZ/lower-priced stocks on margin?
A: Both wells-fargo and Etrade shows that I can margin 20k, but when I place the order I can only buy 500 shares at 7 dollars... if you want to short a stock and your broker won't allow it, look into a synthetic short. http://www.theoptionsguide.com/synthetic-short-stock.aspx Alright, anyone else? Go ahead and brag, just get those details out there! I can't get off the FAS train.