Shorting stock, also known as short selling, involves the sale of stock that the seller does not own, or shares that the seller has taken on loan from a broker. Traders may also sell other securities short, including options.
A typical motivation for a short sale is the hope, fear, or perhaps only the tentative expectation that the market value of the asset will decline. For the realization of good and profitable selling stocks short strategies, it is important to short a stock. There are stock market situations when it is preferable to sell short instead of going long and buying shares, such as the bear stock market trend, the relative weakness or strong trend reversal.