short interest


Definition of short interest

: the sum of securities or commodities sold short as of a given date

called also short position

Love words?

You must — there are over 200,000 words in our free online dictionary, but you are looking for one that’s only in the Merriam-Webster Unabridged Dictionary.

Start your free trial today and get unlimited access to America's largest dictionary, with:

  • More than 250,000 words that aren't in our free dictionary
  • Expanded definitions, etymologies, and usage notes
  • Advanced search features
  • Ad free!

Keep scrolling for more

More Definitions for short interest

short interest


Financial Definition of short interest

What It Is

Short interest is the number of shares or units of a security that have been sold short and not yet covered or repurchased. It is typically expressed as a percentage of the total securities outstanding.

How It Works

Let's assume that Company XYZ has 3 million shares sold short and 120 million shares outstanding. By using this information, we can calculate that Company XYZ's short interest is:

Short Interest = 3,000,000/120,000,000 = 2.5%

Many financial publications and websites report the short interest for various stocks and securities at the middle and end of each month.

Why It Matters

Short interest is an indicator of bearish sentiment for the market as a whole and for particular securities. Though Face value should be just one of several factors investors should consider when buying or selling, some analysts believe that securities with low short interests are less likely to experience price declines and short squeezes.

However, other analysts believe that securities with high short interest are more likely to increase in price because eventually the short sellers will have to buy the security to cover their short positions. Either way, large changes in a security's short interest often indicate big changes in investor sentiment, which is something worth investigating regardless of whether an investor intends to short a stock or not.

Source: Investing Answers

Comments on short interest

What made you want to look up short interest? Please tell us where you read or heard it (including the quote, if possible).


appealing forcibly to the mind or reason

Get Word of the Day daily email!

Test Your Vocabulary

Farm Idioms Quiz

  • cow coming home
  • What does 'poke' refer to in the expression 'pig in a poke'?
True or False

Test your knowledge - and maybe learn something along the way.

Add Diction

Test Your Knowledge - and learn some interesting things along the way.

Love words? Need even more definitions?

Subscribe to America's largest dictionary and get thousands more definitions and advanced search—ad free!