Market Maker

Short Selling

How do you profit when a stock falls? You borrow it, sell it, and buy it back cheaper. Short selling is one of the market's most powerful — and most dangerous — mechanics: theoretically unlimited losses, a borrow fee, dividends you owe, and the ever-present risk of a short squeeze. Learn exactly how it works, where the borrowed shares come from, and why the risk is shaped so differently from going long.