> You can get more the 100% without naked shorts, sure, but is that legal?, does SEC allow that?
Yes. As someone lending out a share (for someone else to short), you can't know whether the person you bought it from had borrowed it to sell it to you.
Let's say you bought a share of stock. Can you lend it to someone for them to short sell? Of course. You own the share, regardless of how many people it passed through to get to you.
Yes. As someone lending out a share (for someone else to short), you can't know whether the person you bought it from had borrowed it to sell it to you.
Let's say you bought a share of stock. Can you lend it to someone for them to short sell? Of course. You own the share, regardless of how many people it passed through to get to you.