Short Interest

[SHAWRT IN-tuh-rist]

What is the definition of Short Interest?

The total number of shares of a stock that have been sold short by investors and have not yet been covered or closed out.

Using Short Interest in an Example

Short interest is often used as a market indicator, where high short interest can suggest that investors expect the price of the stock to decline. For example, if a company has 1 million shares sold short out of 10 million shares outstanding, the short interest ratio would be 10%, indicating significant bearish sentiment.

Using Short Interest in a sentence

The financial analyst noted that the rising short interest in the technology sector could signal an upcoming downturn in stock prices.

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