Short Sale Squeeze

A short sale squeeze occurs when there are many short sale positions on a stock the stock begins to increase. As the stock price rises, the short sellers scramble to cover their short positions, i.e., buying the stock they have sold back. This creates demand for the stock above that which caused the stock price to start rising in the first place, and can lead to rapid price appreciation.

Short Selling

The selling of a security that the seller does not own (naked or uncovered short) or has borrowed (covered short). Short selling is a trading strategy. Short sellers assume the risk that they will be able to buy the stock at a lower price, cover the outstanding short, and realize a profit from the difference.

Short

This is a condition resulting from selling an option and not owning the related securities.

Short Sale

Selling stock you don’t own. You hope it drops in price so you can buy it back later at a lower price. You must have a margin account with your broker to sell short.