What Is Shorting a Stock?

Shorting a stock means betting its share price will go lower, but the strategy is not for the faint of heart. Here's why shorting a stock is so risky for investors.

closeup of keyboard with green "long" and red "short" buttons
(Image credit: Getty Images)

You might have heard traders refer to "shorting" or "short selling" a stock. But what is shorting a stock and is it something you should consider?

Let's start with the basics. 

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Charles Lewis Sizemore, CFA
Contributing Writer, Kiplinger.com

Charles Lewis Sizemore, CFA is the Chief Investment Officer of Sizemore Capital Management LLC, a registered investment advisor based in Dallas, Texas, where he specializes in dividend-focused portfolios and in building alternative allocations with minimal correlation to the stock market.