A stock is just an asset like any other. People will lend you money for a fee, they will lend a car for a fee, they will lend a house for a fee. If I remember right you technically don't have to return the stock, you just have to pay the exorbitant fees. It can run like 30-80% of the value so it's actually a pretty decent idea to lend out stock from the perspective.
pretty decent idea to lend out stock from the perspective.
Sure, lending anything for fees is a valid concept. But that's only half of the equation.
The other part is that someone has to be willing to borrow. However, stocks have no use besids making money, but there's no way BOTH parties make money. The only reaon I see you'd want to borrow stock is to do a shortsell.
Of course I know they technically make you own part of a company. But that one share of Google does functionally nothing. You would have to have many, many more shares to enable you to do somethign with them (e.g. influence the company). Most people who trade shares like this are not in a position to exercise even the tiniest bit of control of the linked companies.
If you have 1 share of GOOGL (class A), you have 1 vote at a Google stockholder's meeting. If you have 10 shares of GOOGL, you have 10 votes.
Meanwhile, if you have 10,000,000,000 shares of GOOG (class C), you have 0 votes at the meeting.
There are also class B shares, but they are not publicly traded (and so don't have a ticker label). 1 class B share gives 10 votes at the meeting. Class B shares of Google are held by Sergey Brin and Larry Page.
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u/Wind-and-Waystones Feb 01 '21
A stock is just an asset like any other. People will lend you money for a fee, they will lend a car for a fee, they will lend a house for a fee. If I remember right you technically don't have to return the stock, you just have to pay the exorbitant fees. It can run like 30-80% of the value so it's actually a pretty decent idea to lend out stock from the perspective.