There are 10 questions in this Q & A. Take the test and find out how much you know. Your responses are not being recorded so don't worry about getting anything wrong. The idea's simply to get a sense of what you do and don't know.
1. Short selling involves
No: The correct answer is that short selling involves selling stocks you don't own in order to buy them back at a lower price. In practice, you borrow stocks that you believe to be overvalued and likely to fall in value. By selling them at a high price and buying back at a low price, you make money on the differentialminus the cost of borrowing the stocks in the first place, of course.
