Yes, you can short stocks on Robinhood, but only with a Robinhood Gold membership

Shorting — betting that a stock price will fall — is not available on a standard Robinhood account. You need Robinhood Gold, which is Robinhood's paid subscription tier. The membership costs $5 per month and gives you access to margin trading, which is the mechanism that lets you short a stock.

When you short a stock on Robinhood Gold, you are borrowing shares from Robinhood's lending pool, selling them at the current price, and hoping to buy them back later at a lower price. The difference between what you sold them for and what you paid to buy them back is your profit or loss. Robinhood charges you interest on the borrowed shares, and you pay that fee as long as you hold the short position.

Not every stock can be shorted. Robinhood maintains a list of shortable securities, and that list changes based on availability. Some stocks, especially penny stocks and very new IPOs, may not be available to short even if you have Gold.

Key Takeaways

  • Robinhood Gold membership is required to short stocks; a standard account cannot short under any circumstances.
  • Shorting on Robinhood works through margin borrowing, and you pay interest on the borrowed shares for as long as you hold the position.
  • Not all stocks are shortable — Robinhood publishes which securities are available to short, and the list changes regularly.
  • If the stock price rises instead of falls, your losses can theoretically be unlimited, unlike buying a stock where your maximum loss is what you paid.
  • Robinhood can force you to close a short position if you run out of buying power or if the stock becomes unavailable to short.

How to set up shorting on your Robinhood account

First, you must upgrade to Robinhood Gold. Open the app or website, go to your Account menu, select Membership, and choose Robinhood Gold. You will be charged $5 per month, and the membership is active when ready. Your account will then have access to margin buying power, which is the credit Robinhood extends to you to borrow and short.

Once Gold is active, open any stock's detail page in the app. You will see a "Sell" button instead of just a "Buy" button. Tap or click "Sell," and a menu will appear asking whether you want to sell shares you own or short the stock. Select the short option, enter the number of shares you want to short, and review the order before confirming. The order executes at market price or at a limit price you set.

Before you short, check Robinhood's shortable securities list. You can find this on the Robinhood website or by searching the stock symbol in the app — if shorting is not available, the short option will be grayed out or unavailable. If a stock is not shortable, you cannot short it, even with Gold.

Interest rates and borrowing costs

When you short a stock on Robinhood Gold, you pay a borrow fee — an interest rate on the shares you borrowed. The rate varies depending on how many shares are available to borrow and how much demand there is. Robinhood publishes borrow rates for each shortable stock, and you can see the rate before you place the order.

Borrow rates are typically between 0.5% and 3% per year for common stocks, but rates on hard-to-borrow stocks can be much higher. The fee is charged daily and deducted from your account automatically. If you hold a short position for a month, you will pay roughly one-twelfth of the annual rate. If you hold it for a year, you pay the full annual rate.

You can see your current borrow fees and the interest accruing on your short positions in the Positions section of your account. The fee continues to accrue until you close the short position by buying the shares back.

Risks specific to shorting on Robinhood

Shorting has risks that buying stocks does not have. When you buy a stock, the most you can lose is the money you invested. When you short a stock, your losses are theoretically unlimited — if the stock price rises to $100, $1,000, or higher, you still owe the shares back at that price.

Robinhood can force you to close a short position if your account runs out of buying power. If the stock you shorted rises sharply, your losses grow, and Robinhood may issue a margin call — a demand that you deposit more money or close positions to bring your account back into compliance. If you do not respond, Robinhood will close the position for you, locking in your loss at that moment.

Additionally, Robinhood can recall borrowed shares at any time. If the shares you shorted become unavailable to borrow — for example, if very few shares are available in the lending pool — Robinhood may force you to buy them back and close your position, even if you want to hold it longer. This is called a forced buy-in, and it can happen without warning.

How to close a short position

To close a short position, you buy back the shares you borrowed. Open your Positions tab, find the stock you shorted, and tap or click on it. Select "Buy to Close" (or similar language depending on your app version), enter the number of shares to buy back, and confirm the order. The order executes at market price or at a limit price you set.

Once the order fills, your short position is closed. Your profit or loss is calculated as the difference between the price you sold at (when you shorted) and the price you bought back at, minus the borrow fees you paid. If you shorted 100 shares at $50 and bought them back at $40, your gross profit is $1,000, but you subtract the interest you paid to get your net profit.

You can close a short position at any time during market hours. There is no minimum holding period, and you do not have to wait for the stock to fall. If you change your mind or want to cut losses, you can buy to close when ready.

Stocks that cannot be shorted on Robinhood

Robinhood does not allow shorting on all securities. Penny stocks (stocks trading below $5), most OTC (over-the-counter) stocks, and very new IPOs are typically not shortable. Robinhood also restricts shorting on stocks during certain events, such as when a company is in bankruptcy or when there is extreme volatility.

You can check whether a stock is shortable by searching for it in the Robinhood app. If the short option is not available, the stock is not on Robinhood's shortable list. The list changes regularly as stocks are added or removed based on availability and market conditions.

If you want to short a stock that Robinhood does not offer, you would need to use a different brokerage. Some brokerages have longer shortable lists, though they may charge higher fees or require larger account balances.

Frequently Asked Questions

Do I need Robinhood Gold to short, or can I do it with a standard account?

You must have Robinhood Gold. Standard Robinhood accounts cannot short stocks under any circumstances. Gold costs $5 per month and is the only way to access margin trading and shorting on Robinhood.

What happens if the stock I shorted goes up instead of down?

Your loss grows as the stock price rises. Unlike buying a stock where your maximum loss is what you paid, shorting has no maximum loss limit. If you shorted at $50 and the stock rises to $100, you owe $5,000 more per 100 shares shorted. Robinhood may issue a margin call if your losses get too large.

Can Robinhood force me to close a short position?

Yes. Robinhood can force you to buy back shares if your account runs out of buying power (margin call), if the stock becomes unavailable to borrow, or if there is extreme market volatility. A forced buy-in locks in your loss at that moment, even if you wanted to hold longer.

How much does it cost to borrow shares when I short?

Borrow rates vary by stock and range from roughly 0.5% to 3% per year for common stocks, though hard-to-borrow stocks can be much higher. The rate is charged daily and deducted from your account. You can see the borrow rate before you place a short order.

What if I want to short a stock that is not on Robinhood's shortable list?

You cannot short it on Robinhood. You would need to use a different brokerage that offers shorting on that particular stock. Some brokerages have longer shortable lists, though they may charge higher fees or require larger minimum account balances.