If the company that promised to sell a stock at a certain price (i.e. shorted it) goes bankrupt, who’s liable for the matched orders from the past? The market? The trading platform? If it’s the latter, how do they avoid going bankrupt themselves once shit hits the fan?
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the trading platform "should" be liable for any losses if they let hedge funds gamble around without enough collateral
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Replying to @materkel
How do they know there’s enough collateral?

Jan 28, 2021 · 10:02 PM UTC

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Replying to @stilkov
that collateral needs to be locked in the trading account until the position is resolved. If the stock grows too much (the cash collateral gets close to not being enough to buy back the stock) you get liquidated. At least that's what happens when normal people trade on margin
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