A short sale is a bet that the price of a stock will go down. In a short sale, you sell shares that your broker has borrowed from an investor who owns shares. If the strategy works, you can buy the shares back later, at a lower price, return the shares to their owner and pocket the difference.

Selling short is considered riskier than buying stocks or "going long." When you buy a stock, you can’t lose more than your investment. But when you go short, your losses are potentially unlimited because the stock, theoretically, could keep going up forever. Also, stocks in general tend to rise over time, so selling short is going against the grain.

One way to gauge bearish sentiment in a stock is to look at short interest, or the number of shares sold short, or days to cover, which is short interest divided by average daily trading volume.

Nasdaq and the New York Stock Exchange publish monthly reports showing short interest in stocks that trade on their markets. Go to http://www.nasdaqtrader.com/asp/short_interest.asp or www.nyse.com/marketinfo/datalib/1022221393023.html