InvestorsHub Logo
Followers 2
Posts 25
Boards Moderated 0
Alias Born 02/22/2017

Re: murphpug post# 67409

Monday, 03/06/2017 8:26:28 PM

Monday, March 06, 2017 8:26:28 PM

Post# of 203913
In simple terms, a investor contacts their broker and wants to borrow a certain amount of shares. The broker finds someone who loans their shares to the investor who sells them right away and pockets the money. They are betting that the share price will be lower right away and buys back the same amount of shares for a lower price and returns the shares to the broker and the investor pockets the difference. This is known as shorting.
There is typically a a gain monetarily for the person who loans their shares and a fee paid to the broker by the investor.
I hope I explained that right