Selling a security you do not currently own, with the intention of buying it back later at a lower price.
Short selling involves selling a stock or derivative that the trader does not currently own, typically by borrowing it, with the aim of buying it back later at a lower price to profit from a decline. In the cash market, intraday short selling is common while short selling that carries beyond the trading day has restrictions for retail traders; in the futures and options market, initiating a short (sell) position doesn’t require borrowing, making derivatives a more direct route to express a bearish view.
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