Buy Low Sell High

Buy low and sell high is the goal of most investors. However, short sellers are just the opposite. They want to short a stock at a higher price, then buy it later at a lower price.

When you short a stock someone or entity is going to buy that stock from you at the short price (example $26.00). Later you hope to buy the stock at a lower price (example $25.00) knowing that someone is obligated to buy it from you at a higher price.

In the example above you would profit $1.00 per share (minus commissions, interest, and fees).

Yep! We must always pay the man.