Penn State University - Smeal College of Business
PSU search
Student Exchange Smeal site map Contact us Accounting faculty directory

Steven Huddart picture
Should I exercise my stock options?
Case Studies
Stock compensation glossary
Compensation links
Securities law links
Tax links
Office hours and location
Facts About The School
Home | Previous | Next | Huddart Site Map

Short position

An investor's position where the number of contracts sold exceeds the number of contracts bought. For example, someone who is short in a stock does not own the stock, but is under the obligation to deliver shares of the stock at some future time. Someone who has a short position is a net seller.

The result of selling a financial instrument not owned at the time of sale. This strategy is undertaken when the short seller anticipates a price decline, in which case the seller can make delivery on the short sale with securities subsequently purchased at a lower price, thereby earning a profit roughly equal to the spread.

The opposite of a Long position.

Steven Huddart
Smeal College of Business, Penn State University, University Park, PA 16802-3603 USA
(814) 863-0048
Home | Previous | Next | Huddart Site Map
was last updated on Tue, Aug 21, 2018.
Today is Thu, Dec 12, 2019.

Unless otherwise noted, all material is:
Copyright ©1995-2018 Steven Huddart. All rights reserved.