what is stock lending 
stock lending is the lending of shares to another party for a fee as well as with interest charges stock lending is primarily done in short sell trades where the seller doesn t own the stock but needs it for the trade it can also be used for hedging and arbitrage trades the bottom lineloan stock is used to reduce the risk of lending lenders have access to collateral in the form of shares if the borrower is no longer able to make good on their debt the risk for the lender is that the price of the shares drops from when the deal was made effectively reducing their collateral value and putting them in danger of not recovering the loan amount if it goes into default 