Questions: Short selling is A) selling an odd lot B) selling borrowed securities C) selling against the investor's broker's advice D) selling stock owned for less than a year

Short selling is A) selling an odd lot B) selling borrowed securities C) selling against the investor's broker's advice D) selling stock owned for less than a year
Transcript text: Short selling is A) selling an odd lot B) selling borrowed securities C) selling against the investor's broker's advice D) selling stock owned for less than a year
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Solution

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The answer is B: selling borrowed securities.

Explanation for each option:

A) Selling an odd lot - This refers to selling a quantity of stock that is less than the standard trading unit, typically less than 100 shares. It is not related to short selling.

B) Selling borrowed securities - This is the correct definition of short selling. In short selling, an investor borrows securities and sells them on the open market, planning to buy them back later at a lower price to return to the lender.

C) Selling against the investor's broker's advice - This describes a situation where an investor acts contrary to their broker's recommendations. It is not specific to short selling.

D) Selling stock owned for less than a year - This describes a short-term capital gain situation, not short selling. Short selling involves selling securities that are not owned by the seller.

In summary, short selling involves selling borrowed securities with the intention of buying them back at a lower price.

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