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Welcome to your source for answers to questions about option concepts, strategies, and terminology. A new question and answer is published each week. To view the Ask the Institute archives, click the "Ask the Institute Archive" link below.
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This week's question:
DATE: April 14, 2014
Can you explain what it means to sell stock short?
Selling stock short is a strategy that is more frequently referred to as "selling short" or "shorting stock." If a trader has a market outlook that the price of a specific stock will fall, then selling stock short is one commonly-used strategy that may attempt to profit from such a bearish forecast. To learn more about selling stock short, view this segment of "Ask the Institute."