tmac5445 asked:
Would this be a 100% gain? Say I shorted CFC, 100 shares at $7 and it goes bankrupt, how much money would that be? Thanks!
Would this be a 100% gain? Say I shorted CFC, 100 shares at $7 and it goes bankrupt, how much money would that be? Thanks!
No. Even after a company declares bankruptcy, the stock still trades.
The fact that the company files for bankruptcy does not mean that the stock price automatically goes to zero. Some companies successfully reorganize while under bankruptcy protection and continue as going concerns.
In some bankruptcy cases, the common stock is canceled as part of the reorganization and new stock is issued. If that happens, the the original stock has no value. However, you can’t count on that happening in every situation.
you made 700 dollars…when you short a stock you borrow those shares and sell them agreeing to give them back at a later date. On your end you want the stock to go down so when you buy them back to give back to the original owner it doesnt cost as much as you sold them for. So again you borrowed 100 shares and sold them for 7 (100*7$)= 700-(100*current price of zero) = 700-0=700 dollars
not sure on that one but contact your broker not people on Yahoo Answers ( not that other people on hear would not have a good answer go to a pro since you have money in the market)