Why Fidelity Is Solid for Short Selling
Fidelity is one of the largest brokers in the world with over $11 trillion in customer assets. For short sellers, this matters because size means inventory. Fidelity has a massive pool of shares available to lend, which means you can short stocks that smaller brokers like Webull or Robinhood cannot offer.
Think of it like shopping at Costco versus a convenience store. Both sell groceries, but Costco has everything in stock. If you need to short how to short a stock that is hard to borrow, Fidelity usually has shares available.
Requirements
- Margin account with minimum $2,000 deposit
- Margin agreement signed (apply through account settings)
- Short selling agreement signed (separate from margin in some cases)
How to Short Sell on Fidelity (Web)
- Log into Fidelity.com
- Go to Accounts & Trade then Trade
- Select your margin-enabled account
- Under Action, select Sell Short
- Enter the stock ticker
- Enter the number of shares
- Choose order type: we recommend Limit. Avoid market orders when shorting because slippage can be significant
- Set your limit price
- Click Preview Order then Place Order
To close: Select Buy to Cover as the action. Enter the same number of shares. Execute.
How to Short on Active Trader Pro (Desktop)
Fidelity’s Active Trader Pro platform gives you more control:
- Open Active Trader Pro (free download from Fidelity)
- Use the Directed Trade window for better execution
- You can see real-time short availability and borrow rates before placing the order
- Set up hotkeys for quick short entries and covers
- Use the built-in Level 2 and Time & Sales to confirm your setup
Active Trader Pro is the better choice for active short sellers. The web platform works but is slower for execution timing.
Fidelity Short Selling Costs
- Commissions: $0 for stocks and ETFs
- Borrow fees: Vary by stock. Easy-to-borrow is under 1%. Hard-to-borrow varies. Fidelity displays the rate before you place the order.
- Margin interest: Fidelity’s margin rates start around 12% for small balances. Rates decrease with larger balances. Compared to Interactive Brokers (which starts around 6%), Fidelity’s margin is higher. See our full cost breakdown.
Tips for Shorting on Fidelity
- Check the “Shortable” indicator on the stock page before planning your trade
- Use VWAP as your reference point for short entries on intraday trades
- Set a stop loss immediately after entering
- Watch volume to confirm sellers are in control
- Paper trade using Fidelity’s practice tools before going live
For a full review of the platform, see our Fidelity broker review.
Disclaimer: This article is for educational purposes only and does not constitute financial advice. Short selling involves substantial risk of loss. Always consult a qualified financial advisor before making trading decisions.