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Learn More About Selling Short
Selling short involves the sale of a stock that the seller doesn’t own,
but which is loaned to the seller by BMO InvestorLine. Selling short
is a speculative practice that an investor might undertake on the belief that the
price of the stock is going to fall. If the price falls, the seller is then
able to buy the stock back at a lower price, re-pay the outstanding stock
loan and keep the profit from the transaction. Short selling is only available
for margin accounts and you must be approved for Short Sales before this type
of order can be accepted.
You must declare that you are selling short when placing your
order. To do so, select Sell Short from the Action drop-down menu
on the order entry screen. Your order will be reviewed by a BMO
InvestorLine representative and if there are any problems, you
will be contacted before your order is submitted to the exchanges.
BMO InvestorLine does not accept Short Sell orders for stocks listed
on the TSX Venture Exchange or OTC Bulletin Board (pink sheets).
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