Why allow shorting of the stock you hold?

Maybe a dumb question but as I understand it, shorting a stock means that you borrow a stock from a broker (this could be your stock you hold on this broker) and immediately sell it, so you can buy it back later when it dropped and give it back.

Okay, but why would any investor who holds said stock and is therefore long, allow his shares to be shorted if it results in a negative price trend which you are obviously not interested in as a long?



View Reddit by TaraihView Source

Leave a Reply

Your email address will not be published. Required fields are marked *