taking an investment position that will benefit if the value of the stock goes down. Traditionally, "shorting a stock" means borrowing shares of stock from another broker, selling them, then buying them back (
after the price has fallen) in order to return the stocks to the broker from whom they were borrowed.
You can short a stock using a
derivative; this can include buying futures in the stock (i.e., a contract to sell someone else the stocks); or buying a put option (also called a put). A third way is to
write a call (i.e., a call option, also known as a call) for the stock.
