What is Short-Selling?

Selling shares in companies can be used for short-term profit or to balance risk in a fund manager's portfolio

James Gard 13 August, 2019 | 10:03AM

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Short-selling is back in the spotlight after a report by US hedge fund Muddy Waters sent shares in legal financing Burford Capital down 65% on one day.

Shorting is when you effectively bet against a company. Instead of buying its shares and hoping their value rises, you take a reverse position whereby you profit if the shares fall. 

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Jupiter Absolute Return I Acc45.10 GBP-0.35
Kier Group PLC78.00 GBP0.00
Ocado Group PLC2,000.00 GBP0.00
Scottish Mortgage Ord860.04 GBP0.71

About Author

James Gard  is content editor for Morningstar.co.uk

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