Short (or Short Position)

Filed Under » ,
Dictionary Says

Definition of 'Short (or Short Position)'

1. The sale of a borrowed security, commodity or currency with the expectation that the asset will fall in value.

2. In the context of options, it is the sale (also known as "writing") of an options contract.

Opposite of "long (or long position)."
Investopedia Says

Investopedia explains 'Short (or Short Position)'

1. For example, an investor who borrows shares of stock from a broker and sells them on the open market is said to have a short position in the stock. The investor must eventually return the borrowed stock by buying it back from the open market. If the stock falls in price, the investor buys it for less than he or she sold it, thus making a profit.

2. For example, selling a call (or put) options contract to a buyer entitles the buyer the right, not the obligation to buy from (or sell to) you a specific commodity or asset for a specified amount at a specified date.

Learn more about this dynamic strategy - Read When To Short A Stock.

Related Video for 'Short (or Short Position)'

Articles Of Interest

  1.

    When To Short A Stock

    Learn how to make money off failing shares.

  2. The Short Squeeze Method

    The short squeezed strategy can be risky - but also very rewarding - for those who master it.

  3. Short Sales For Market Downturns

    This strategy can help in market downturns, but it's not for inexperienced traders.

  4. Short Selling

    Learn more about this trading strategy where the investor profits from the decline of a stock price.

  5. Shorting ETFs: Profit Or Peril?

    Although more detail and attention may be needed, ETFs can be shorted - and at a great profit.

  6. Short Interest: What It Tells Us

    This figure can be a real eye-opener about the market sentiment surrounding a given stock.

  7. Finding Short Candidates With Technical Analysis

    Learn how to distinguish tops and bottoms in the equity market when short selling.

  8. Questioning The Virtue Of A Short Sale

    This controversial strategy is blamed for making and breaking markets. Read on to learn more.

  9. The Short And Distort: Stock Manipulation In A Bear Market

    High-quality stock reports needn't be confused with stock manipulators' dramatic claims.

  10. Short Selling Tutorial

    Want to profit on declining stocks? This trading strategy does just that.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Network Effect

    A phenomenon whereby a good or service becomes more valuable when more people use it. The internet is a good example...

  2. Racketeering

    Racketeering refers to criminal activity that is performed to benefit an organization such as a crime syndicate. Examples of racketeering activity include...

  3. Lawful Money

    Any form of currency issued by the United States Treasury and not the Federal Reserve System, including gold and silver coins, Treasury notes, and Treasury bonds. Lawful money stands in contrast to fiat money, to which the government assigns value although it has no intrinsic value of its own and is not backed by reserves.

  4. Fast Market Rule

    A rule in the United Kingdom that permits market makers to trade outside quoted ranges, when an exchange determines that market movements are so sharp that quotes cannot be kept current.

  5. Absorption Rate

    The rate at which available homes are sold in a specific real estate market during a given time period.

  6. Yellow Sheets

    A United States bulletin that provides updated bid and ask prices as well as other information on over-the-counter (OTC) corporate bonds...
Trading Center