Which of the following is false regarding short sales?
A) The maximum potential loss on a short sale is unlimited.
B) You will receive a margin call on a short sale only if the stock price rises.
C) The maximum potential dollar gain from a short sale is the stock price when shorted.
D) A short sale must be covered within one year.
E) If you short a dividend paying stock you must pay for any dividends the stock pays while you are shorting the stock.

Question

Quizplus · Accepted Answer

A short sale must be covered within a timeframe specified by the broker, which is usually less than a year.

Which of the Following Is False Regarding Short Sales