What is borrowing shares?Borrow
Before shorting, you borrow shares from your broker, and you must eventually buy back the same number to return them.
Animation · borrowing shares
Learn “borrowing shares” in an animated lesson
- Arbitrage StrategiesConvertible Bond Conversion Arbitrage
A convertible bond can be swapped for stock at an agreed price. When the stock jumps and the convertible lags, buy the convertible, convert, and sell the stock to pocket the gap, as long as you lock away the overnight risk.
- Stock Trading: Next StepsGoing Long vs. Going Short
Step by step: borrow shares → sell → buy back → return. See how shorting profits from a fall, and why it's riskier.
Related terms
See how “borrowing shares” works for yourself with an animation you can drag and play.
Go to “Convertible Bond Conversion Arbitrage”