Selling Short

Definition: Selling securities, commodities, or currency not actually owned by the seller. Definition: [crh] Selling a stock not actually owned. If an investor thinks the price of a stock is going down, the investor could Definition: HREF="/?rd=borrow">borrow the stock from a broker and sell it. Eventually, the investor must buy the stock back on the openDefinition: A> market. For instance, you borrow 1000 shares of XYZ on July 1 and sell it for $8 per share. Then, on Aug. 1, you purchase 1000 shares of XYZ at $7 per share. You've made $1000 (less commissions and other fees) by selling short.

<< Go back