Pro lesson, preview locked
Unlock the full video and walkthrough with FinanceFlow Pro.
5:00Securities Lending: The Hidden Rental Market Inside Your Index Fund
Your "passive" index fund is quietly renting out its shares to short-sellers for a fee. That rental income, and the risks attached to it, never show up on the price chart.
A short-seller needs to deliver shares it doesn't own, so it has to *borrow* them. The shares come from long-term holders sitting on huge inventories: index funds, ETFs, pension funds, insurers. This is securities lending, a multi-billion-dollar rental market bolted onto the back of "buy and hold".
Unlock the full lesson with Pro
The complete walkthrough, rail map and quiz for Securities Lending: The Hidden Rental Market Inside Your Index Fund, plus every Pro lesson in the library.