Short selling


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Related to Short selling: hedging

Short selling

Establishing a market position by selling a security one does not own in anticipation of the price of that security falling.

Short Sale

The sale of borrowed securities. In a short sale, one borrows securities, usually from a brokerage, and sells them. One then buys the same securities in order to repay the brokerage. Selling short is practiced if one believes that the price of a security will soon fall. That is, one expects to sell the borrowed securities at a higher price than the price at which one will buy in order to return the securities. Selling short is one of the most common practices of hedge funds. This is also called establishing a bear position. See also: Margin account.
References in periodicals archive ?
If the fundamental price is truly 20 percent below the previous closing while the rule discourages short selling after a 10 percent drop, buyers at that price may end up losing 10 percent of their investment.
The leading opinion is that restricting short selling in any form will hurt price discovery and liquidity resulting from short selling.
ASIC also encourages short sellers and system developers to continue to monitor ASIC Information Sheet 98 Short selling, which includes key tasks and practical information they must be aware of prior to the start date for the new reporting requirements.
net is a service designed to combat short selling and naked short selling in US stocks.
The Company is committed to providing its shareholders with credible information on all matters material to its business practices, including non speculative short selling information we are able to obtain.
Cameron Funkhouser, NASD's senior vice president of market regulations, told the forum that NASD had found no evidence of rampant naked short selling.
29, 2003, by implementing a new rule to ban naked shorting in order to protect thinly traded stocks that are vulnerable to aggressive short selling which would cause the stock price to fall.
While short selling may be the industry's dirty little secret this company will not stand by and watch its hard work and earnest efforts to build a legitimate business get destroyed," said IBAC President Edward W.
We have confidence that our regulators, who carefully review our activities, understand that short selling is a trading strategy and is not related to the post-trade clearance and settlement process.
The regulation and associated list aims at modernizing rules on short selling by addressing a primary symptom of naked short selling which involves a brokerage firm's failure to deliver stock on the settlement date.
These listings may be part of an effort by stock traders to avoid recently enacted SEC restrictions prohibiting "naked short selling.
PHOENIX -- According to This List, Fewer Than 3% of Listed Public Companies in the US Are Affected by Excessive Failed Delivery of Securities Associated with Naked Short Selling