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Investments glossary

Short Covering Definition


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Quotes of the day:

Not all treasure is silver and gold, mate.

— Johnny Depp, Pirates of the Caribbean

Short covering refers to buying back borrowed securities in order to close out an open short position at a profit or loss. It requires purchasing the same security that was initially sold short, and handing back the shares initially borrowed for the short sale. This type of transaction is referred to as buy to cover.

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