Cliff places an order to sell 500 shares of the stock of Gap, Inc. (GPS) via his broker's website. Cliff does not currently own any shares of GPS. This order is:

Question

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When Cliff places an order to sell shares of GPS, a stock he doesn't own, on his broker's website, it is referred to as a short sale. A short sale is defined as the sale of borrowed stock and is placed by an investor who expects the price of that stock to fall in the near future, at which point the investor will buy it back at a lower price and return it, profiting from the price differential.

Cliff Places an Order to Sell 500 Shares of the Stock