When a company is listed in more than one exchange, how the stock exchange prevents a double sell of the same share

External question — Personal Finance Stack Exchange Author: someone235 Original post: https://money.stackexchange.com/questions/153031 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. What prevents a broker from selling the same share simultaneously at two different stock exchanges?

External answer — Personal Finance Stack Exchange Author: Alexis Wilke Original post: https://money.stackexchange.com/a/157850 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. The shares you own are present in your portfolio account, just like you have bank accounts with say dollars in it. When you withdraw $1 from your bank account, your balance goes down by $1. As long as your balance is > 0, you can withdrawn more dollars. Once at $0, it stops (not mentioning negative balances which are possible at most banks, but you'd then owe the bank $$$ and that feature is not available with shares). When you want to sell a share, it has to be available in your portfolio account for "withdrawal". While it is on sale, it is withdrawn from that portfolio account and thus you cannot try that again at a different location. To continue with the comparison, while on sale, it is as if the share was in an escrow account. If you cancel the sale, the share comes back in your portfolio account. Just like you could put that $1 back in your bank account and it becomes part of the balance again.

External answer — Personal Finance Stack Exchange Author: user71659 Original post: https://money.stackexchange.com/a/157859 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Nothing, other than a regulation. Not only that, it doesn't pose a problem in most cases. Recall that stock transactions aren't settled immediately. A trade is made and the actual stock changes hands (currently in the US) two business days after the trade. Therefore, if the seller is able to obtain the promised shares before that time, nobody is the wiser. The seller can buy the shares or borrow them off somebody, and the buyer doesn't know anything special happened. The practice of selling shares without having them in hand is called naked selling, and is typically used in the context of short-selling, creating naked short-selling . The problem only occurs if the seller can't come up with the shares. This is called a failure to deliver , and generally occurs with stocks with little trading activity, or where there's significant speculative events and nobody wants to sell or loan shares. Due to issues with financial markets in the 2008 timeframe, the US SEC promulgated regulation SHO which significantly restricts naked short selling. Naked short selling was seen as a means of market manipulation, by allowing participants to affect the price. Regardless, fails-to-deliver do still occur, meaning people do sell shares without them in hand and are unable to come up with shares. To address your question directly, Regulation SHO initially exempted market makers. So they could sell shares in one exchange without owning them, to buy them up in another exchange shortly afterwards, settle the trades, and make a profit. This was legal. In 2010, the market maker exemption was removed. Now a brokerage to a small, individual investor, will never trust that person enough to allow naked selling, so they will simply ensure the shares are in the brokerage's possession before allowing a sale order to be placed.