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.

Related Video for 'Short (or Short Position)'

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Short Interest Theory

    An investment ...
  2. Buy Weakness

    A proactive ...
  3. Long (or Long Position)

    1. The buying of ...
  4. Regulation SHO

    A regulation ...
  5. Short Covering

    Purchasing ...
  6. Short Interest

    The quantity of ...
  7. Short-Sale Rule

    A Securities and ...
  8. Weak Shorts

    Refers to the ...
  9. Short Squeeze

    A situation in ...
  10. Sell To Close

    In options ...

Articles Of Interest

  1. Short Selling: What Is Short Selling?

    Short selling is done for two reasons: to hedge or to speculate. Learn more here.
  2. Keep It Simple - Trade With The Trend

    Often, the simple solution is the best one. Find out how easy it can be to trade with the trend.
  3. The U.S. Dollar And The Yen: An Interesting Partnership

    In order to make the USD/JPY relationship more understandable, we must look at the yen in terms of treasury bonds.
  4. How To Place Orders With A Forex Broker

    Learn how to set each type of stop and limit when trading currencies.
  5. When To Short A Stock

    Learn how to make money off failing shares.
  6. Forex: The Memory Of Price Strategy

    Hate getting stopped out right before the price reverses? This forex trading strategy may help.
  7. 5 Keys To Unlocking A Better Credit Score

    Follow these tips and techniques to rebuild a ruined credit rating.
  8. Prices Plunging? Buy A Put!

    You can make money on a falling stock. Find out how going long on a put can lead to profits.
  9. Top 4 Most Scandalous Insider Trading Debacles

    Here we look at some of the landmark incidents of insider trading.
  10. The Short And Distort: Stock Manipulation In A Bear Market

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

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center