Friday, August 5, 2011

What is Short in Share Trading?

In terms of share trading, "short" means that you don't have shares of a company and you still sell them.

Yes, any investor can short sell shares of a company even if he has no possession of shares. This is generally done in Indra-day Share Trading. Most share traders do this when he or she expects the price to decline. They sell shares at a higher price and at the end of the day, buy those same shares at a lower price thus making profit. Profit is the difference between the selling price - buying price.

In a rolling settlement cycle, a trader will have to settle the transaction on the same day before the stock market closes.

Short Share Trading

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