Sell the stock, if you own it.
Short Selling - Fidelity
At a later date, you can buy the shares hopefully at a lower price to pay back your broker. Or you can buy a put option , which gives you the right to sell stock at a given price for a pre-determined timeframe.
Why buy a put instead of selling short? Short selling can be tough. Margin is essentially a line of credit for trading stock, for which you make a minimum down payment and pay your broker an interest rate.
Short (finance) - Wikipedia
If the market moves against you suddenly, you may be required to quickly add to this down payment in a margin call. Study the risks of margin to use this tool wisely. You must deliver those shares of stock to the brokerage firm. Buying a put can potentially offer a relatively low-cost, hassle-free alternative to short selling for bearish investors.
Options involve risk and are not suitable for all investors. Options investors may lose the entire amount of their investment in a relatively short period of time. Prior to buying or selling options, investors must read a copy of the Characteristics and Risks of Standardized Options brochure PDF , also known as the options disclosure document.
It explains the characteristics and risks of exchange traded options. November Supplement PDF. You can also request a printed version by calling us at ALLY is a leading digital financial services company and a top 25 U.
Ally Bank, the company's direct banking subsidiary, offers an array of banking products and services. Deposit products "Bank Accounts" on Ally. In addition, mortgage products are offered by Ally Bank, Equal Housing Lender , NMLS ID Credit and collateral are subject to approval and additional terms and conditions apply.
Programs, rates and terms and conditions are subject to change at any time without notice. Securities products and services are offered through Ally Invest Securities LLC, member FINRA and SIPC. View all Securities disclosures. Review the Characteristics and Risks of Standardized Options brochure before you begin trading options.
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Trading privileges are subject to review and approval. Not all clients will qualify.
View all Futures disclosures. Forex, futures, options and other leveraged products involve significant risk of loss and may not be suitable for all investors. Products that are traded on margin carry a risk that you may lose more than your initial deposit.
Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U. Forex and futures accounts are NOT PROTECTED by the Securities Investor Protection Corporation SIPC. Buying a Put Option vs. Learn More About Ally Invest. Related Articles Top 10 Options Trading Mistakes Part 1 Top 10 Options Trading Mistakes Part 2 Investing in Options Part 1. Learn About the Risks of Options Trading.
November Supplement PDF You can also request a printed version by calling us at A few things you should know Ally Financial Inc. The Ally CashBack Credit Card is issued by TD Bank, N. View all Securities disclosures Options involve risk and are not suitable for all investors.
View all Advisory disclosures Foreign exchange Forex products and services are offered to self-directed investors through Ally Invest Forex LLC. View all Forex disclosures Futures trading services are provided by Ally Invest Futures LLC member NFA. View all Futures disclosures Forex, futures, options and other leveraged products involve significant risk of loss and may not be suitable for all investors. Ally Bank Member FDIC.