Comment on Basics on SLB (Stock Lending & Borrowing)

Nithin Kamath commented on 20 Dec 2014, 02:12 PM

The guys who usually use this facility are the arbitrageurs. So assume futures are trading at a discount to spot market. So they borrow and sell it in the spot market, and buy the futures. On the expiry day, when futures and spot is trading at same price, they reverse the trade.

Also the people who want to take a longer term short view on a stock, can use SLB as this way they don’t have to worry about the rollover costs.

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