You borrow stock from someone (or your broker does) and you then sell the borrow stock. You give someone (usually your broker) a promise to give them back the s

You borrow stock from someone (or your broker does) and you then sell the borrow stock. You give someone (usually your broker) a promise to give them back the stock at a later date. That's it. In it's entirety. Depending on the value of your portfolio/margin account, if the value of the stock goes up too much, they may ask for more collateral, etc. But other then that, there isn't anything to it. Shorting a stock is a bet against the price of the stock. Honestly, it doesn't make sense as much as buying a put option in many cases, but sometimes it does. http://en.wikipedia.org/wiki/Put_option http://en.wikipedia.org/wiki/Put_option