The market practice of short selling stocks

Abstract

This dissertation examines the often controversial market practice of short selling stocks. In particular, the study provides an understanding of the possible effects short selling could have on stock prices and financial markets, together with how short selling transactions are conducted, the motivations behind them and the risks faced by those who engage in short selling. The study also presents an insight on the local scenario, where the perception towards the practice of short selling on the Maltese Stock Market is assessed through a questionnaire circulated among various market players.