Short sellers

Question

Short sellers

Quizplus · Accepted Answer

Short sellers are investors who sell shares they do not own in the hope of buying them back at a lower price to make a profit. They believe the security price will drop and have a timeframe to buy back the shares they borrowed (usually with a fee), which is why they are called "short-term" investors. They do not receive the dividend during the short sale, as they are not actual shareholders. Additionally, short selling typically involves a margin requirement, as it involves borrowing shares from a broker.

Short Sellers