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Open Exam Prep

Series 7 Exam Prep 58, Short Sales and Regulation SHO

Tuesday · 3 min · 3.4 MB
0:00-3:38

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This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:
- The core mechanics of a short sale, including the concept of borrowing and returning shares.
- The critical requirements of Regulation SHO, including the 'locate,' order marking, and mandatory close-out rules.
- The distinction between using short sales for speculation versus hedging a long position.
- The dynamics of a short squeeze and how it creates significant risk for short sellers.
- The most critical exam trap: understanding that the maximum loss on an unhedged short sale is unlimited.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep