For questions related to the trading practice of short-selling, which involves selling securities or financial instruments that one doesn't own with the intention of repurchasing them at a lower price.

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2answers
56 views

Where can I find information on the percentage of volume is contributed by shorts?

Is it possible to get the information as to what percentage of the average daily volume of a stock or ETF is due to short sellers? This can mean either people selling short or buying back to cover ...
5
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0answers
137 views

How to bet against the London housing market?

A lot of people are talking about a property bubble in London and I was wondering: how could you short the property market and bet on a crash? Is there any obvious way? Basically, how could someone ...
2
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2answers
77 views

How to calculate how far a shorted stock's price can rise before broker issues a margin call?

If I short AAPL at 500$, how much can the stock rise before I get a margin call? Does it depend on how much Cash/Equity in other stocks I hold in my margin account? I just thought that if margin ...
2
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1answer
140 views

Does the uptick rule apply to all stocks/ETFs and other securities, or only specific ones?

Does the uptick rule on U.S. securities apply universally across all stocks, all bonds, all futures and all options? Or is it limited to certain category of securities/instruments? Is there a ...
5
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1answer
113 views

What happens if a company you hold short merges with another company?

I know how mergers (typically) work when you're long a company, you simply get shares in the merged company equal to your previous market value. But what happens if you hold a short position? The ...
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1answer
78 views

What does it mean when the broker does not have enough shares to short?

I recently opened a margin account at Questrade with 1000 dollars to see if I can learn anything about margin trading. Today, I'm trying to short sell 2 shares of XLU at a $40 limit price and it ...
8
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2answers
344 views

What to do if a company goes bankrupt after I short the stock

If I short a stock and then the company goes bankrupt, what obligation do I have to fulfill to my broker? I can no longer buy the stock back because the stock (i.e. the company) no longer exists, so ...
2
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1answer
83 views

Can I short a stock in UK using a shares ISA?

If not please advise on other straight forward method (hoping I don't have to open a complicated account for this). Thanks
0
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1answer
66 views

Is naked short selling illegal

From the wiki article on naked short selling It is not clear whether this practice is illegal ,or only limited to hedge funds and institutions. I say this because at least my discount brokerage ...
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2answers
39 views

Who gets the margin call when a bear ETF goes down

When I short the SPY, if it goes up, then I get a margin call based on broker's margin requirements. (Not sure if margin requirements are specified by SEC or individual broker, but that is another ...
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2answers
152 views

What do brokers do with bad stock?

I'm new to financial markets and how they work is still fuzzy, so bear with me. This question actually has multiple questions :( ... and a bit of a story. I was watching a YouTube video on the ...
1
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2answers
55 views

Short Selling Specific to India

I'm trying to short sell for the first time and when I asked my broker he says that only Intraday short selling is allowed.That really didn't make any sense as the articles I read said I can short ...
4
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1answer
233 views

Can you short a stock before the ex-div. date to make a profit?

If the price of a share automatically declines the same amount as the dividend on the ex-div. date why don't people short the stock right before the ex-date and then when the share price drops ...
0
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1answer
145 views

What would stop someone from taking advantage of wide bid-offer spreads in extended hours trading via short selling?

I understand that the less volume occurring in a security, the less liquidity (the wider the bid-offer spread). So my question is, in pre-market and after-hours trading, when bid-offer can widen ...
-4
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2answers
348 views

Why does the calculation for percentage profit vary based on whether a position is short vs. long?

In this link here, the point: In a market in which upswings are likely to equal or exceed downswings, heavier position should be taken for the upswings for percentage reasons - a decline from ...
3
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1answer
1k views

What is the “Short sale circuit breaker rule”?

Apparently there's a NASDAQ rule called something like short sale circuit breaker which limits how much a stock can be sold short after a certain drop in price or something like that. It really makes ...
2
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1answer
353 views

Is 'days to cover' a useful metric in identifying the potential for a short squeeze?

When talking about short interest, the 'Days To Cover' is the avg number of days it will take to cover the short position and bring the short interest to 0. But is this figure actually of any use? It ...
4
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1answer
78 views

How do we know the number of shorted shares of a stock?

I am reading this article which discusses Tesla's stock (TSLA). The article states: 27.5 million shares of Tesla are held short, or about 41 percent of the float. How can the number of shorted ...
1
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1answer
253 views

What does the settlement date of short interest mean?

NASDAQ lists data like this for the short interest in Walmart: Settlement Date Short Interest Avg Daily Share Volume Days To Cover 4/30/2013 27,988,175 7,442,123 ...
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1answer
139 views

When shorting stock, why does buying to cover help limit a trader's loss when the stock rises?

In these investopedia articles, they are giving the impression that 'Buying to Cover' is preferable than getting a margin call: Investopedia - Buy To Cover Definition Investopedia - Short Covering ...
2
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2answers
94 views

Can i short securities in a normal(non-margin) account

When I take up a short position, I borrow stocks from my broker and sell them on the market. Does the broker charge interest for this? Also to do this, do I need a 'normal' account or a margin ...
1
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2answers
279 views

How can I make a profit by selling a stock short?

This link states: Shorting (or selling short) allows professional traders to profit regardless of whether the market is moving up or down, which is why professional traders usually only care ...
2
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1answer
88 views

Insider trading of a linked security like an ETF your company has a heavy weighting in

Let's say you work for Apple, Inc as a middle class employee. This is a large publicly traded company. By the very nature of your employment there will be limited times that one can make purchases and ...
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2answers
104 views

Consequences of not closing an open short sell position?

If I short sell stocks of a company but do not close my position by buying them back, what will happen? I realize it is a bad thing, but what exactly? I will need to pay a penalty?
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2answers
110 views

Please explain short interest; specifically, why is it called “interest”?

I understand that short interest is the number of shares that is currently short sold. A high short interest indicates that the share price is expected to fall. All good, but what is the word ...
1
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1answer
121 views

Can I cover a short sale with the stock I already own?

Example Scenario: I short 100 shares of company XYZ. Incidentally, I also own 100 shares of XYZ. The price of XYZ goes down and I need to cover my short sale. Question: Can I cover using the 100 ...
1
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2answers
157 views

Can Indian citizens in India do short-trades in the US?

I have learned of some services that allow Indians to invest in US stocks. However, does anyone know if short-trades are possible through any of these services?
2
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3answers
264 views

If prices are falling, who will lend shares to short sellers?

Short selling is a process that involves borrowing shares from a person, selling them and then buying them back at a lower price, thus realizing a profit. In this situation, knowing that prices are ...
4
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1answer
126 views

Borrowed shares how are they tracked?

When a short position is opened in the stock market how does the brokerage know whether the trader has actually borrowed the shares or not?
4
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2answers
153 views

Professional investment planning for small net-worth individual in bearish market

I would like to find an investment planner that can help me achieve moderately aggressive growth when the stock market is expected to go down. Perhaps he would use shorts and other more short-term ...
3
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3answers
152 views

How to exclude stock from mutual fund

One of the mutual funds I invest in is indexed to the S&P/TSX Composite Index. I have a moral objection to one of the companies who makes up a small part of this index. Hypothetically, is there a ...
6
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1answer
312 views

Wells Fargo Brokerage has no shares of stock to short

I want to short several hundred shares of a stock. Wells Fargo brokerage has no shares to short. Would a different brokerage be likely to have access to shortable shares, or do they all access the ...
3
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1answer
284 views

Short-selling treasuries instead of borrowing on margin?

Let's say I have a diversified investment portfolio, and I wish to tap a relatively small amount of cash (less than 5% of the portfolio's value) without liquidating any of my positions. I could ...
6
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1answer
540 views

Why can't I short a particular stock?

I would like to short a particular popularly traded stock, but when I attempt to do so I keep getting this message all the time: "Order rejected: This stock is not available to borrow. If you want us ...
5
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1answer
227 views

Is there a way to tell how many stocks have been shorted?

When investigating a particular stock it is nice to know how many stocks have been shorted. Is there a way of finding out how many stocks have been shorted (for a given stock)?
4
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2answers
143 views

Can the shorting of S&P futures negatively affect the underlying index and constituent stocks?

I hear people on financial shows talk all the time about index futures like SPY and QQQQ affecting the actual index. Can shorting these futures (in huge quantities obviously) cause the underlying ...
6
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2answers
1k views

If I short-sell a dividend-paying stock, do I have to pay the dividend?

If I hold shares of a stock on the ex div date, I get a dividend. But if instead I were to short-sell the stock and not buy it back before that date, would I then be responsible for paying the ...
10
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5answers
255 views

If I have all this stock just sitting there, how can I lend it out to people for short selling?

Short sellers need to borrow stock in order to short sell. I understand they typically get this stock through a broker though some sort of arrangement where they pay interest. I was wondering, how ...
7
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3answers
373 views

If I sell a stock that I don't have, am I required to buy it before a certain amount of time?

I'm just began playing in the stock market. I just executed a SELL, because I think the market is going down. I don't actually have any of this stock. Apparently, it's quite common strategy. I would ...
12
votes
3answers
675 views

Why is short-selling considered more “advanced” than a simple buy?

Considering the downward spiral in the market (which many are predicted will continue), I was thinking perhaps selling short would be the right strategy. But from what I can tell on my brokerage ...
8
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3answers
3k views

How come I can't sell short certain stocks? My broker says “no shares are available”

I've noticed that a many times while trying to sell short a stock I get this message. (I use Scottrade as my broker). I think these stocks are being manipulated, for example, stocks like BSFT that ...
3
votes
3answers
509 views

“Diversifying” by going Long and Short Simultaneously

I was hoping someone could take a critical eye to an idea i've had. Traditionally it's said that one should diversify across various asset classes and ultimately types to spread the risk out based on ...
6
votes
4answers
500 views

Is short selling a good hedging strategy during overzealous market conditions?

As the stock market keeps increasing, I'm more and more interested in short selling as a strategy to hedge risk and make some money. History has shown that anything that goes up, must come down. The ...
1
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3answers
341 views

Since many brokers disallow investors from shorting sub-$5 stocks, why don't all companies split their stock until it is sub-$5

Seems like a no-brainer? I guess if your security is not marginable, it can't be bought long on margin either, but I would also guess for most companies there are more margined shorts than margined ...
11
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3answers
2k views

Why can't I short a stock that sells for less than $5? Is there another way to “go short” on them?

I don't like satellite radio as a business and I want to short Sirius (SIRI). The stock sells for less than $5, so my broker won't let me short it. Is this a limitation of my broker? Or some SEC ...
15
votes
3answers
2k views

How do you short US Treasuries?

As the US government continues to issue record levels of debt, I don't think it can continue to sell that debt at 2 - 3% interest. It will face the simple supply/demand law of economics - the more ...
5
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1answer
267 views

What are the risks associated with leveraged trading accounts?

What is a leveraged account and why is it mandatory on some trading platforms to operate through leverage? Also, what are the associated risks? Could I end up losing more money than I invested?
16
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3answers
2k views

What is the meaning of “short selling” or “going short” a stock?

Can someone please explain the meaning of 'shorting' a stock with an example?