Short selling is a trading strategy where a trader sells a security they don’t own, expecting the price to drop. The goal is to buy back the security at a lower price and profit from the difference.
In a short sale, you borrow shares from the market and sell them at the current price. Later, if the price drops, you can repurchase the same quantity at the lower price and return the shares—profiting from the price difference.
If you want to express a bearish view beyond intraday:
These derivative instruments allow you to profit from price declines without borrowing the asset.
Scenario | Explanation |
---|---|
I short sell and forget to close my position | Your trade will go to auction, and you may face penalties. |
I want to short sell for more than one day | Use futures or options instead of the cash market. |
I short sell a stock not available for borrowing | The trade may get rejected or lead to settlement issues. |
Last updated: 28 Jun 2025