Wells Fargo Brokerage has no shares of stock to short
This is the bird's eye view of how shorting works: When you place an order to sell a stock short, your broker attempts to grab the desired number of shares from any accounts of its other customers and makes them available for you to sell. If no other customers own shares of this stock, then generally you are out of luck (It is more complicated like that in practice, but this is just an overview).    Your odds are better if the particular stock has a large float (i.e. a large number of shares that are actually available for trading) and its short ratio is low (which means relatively few shares   are currently being sold short). Also, a large brokerage may be more likely to have access to the shares than a small niche-market broker.   The example you've given, Angie's List (ANGI) is a $600M small-cap with a comparatively low float, and though I haven't been able to glean the short ratio, it appears that a lot of investors are bearish on this stock and probably already had the same idea to short it.  There is really no way to find out if a specific broker has shares in inventory available for shorting, short of (forgive the pun) checking directly with the broker.
Patrick Byrne (CEO of Overstock.com) ran a somewhat interesting website awhile back called 'Deep Capture' which focused heavily on naked short selling and bear raids. He was called all sorts of names and many 'serious' journalist types brushed his allegations off.   His basic argument was that a cabal of hedge funds would simultaneously naked short a specific equity and then a coordinated group of journalists and message board jockeys would disparage the company as loudly and publicly as possible, driving the price down. Naked shorting is supposed to be illegal since you can hold the types of positions like in the linked article about Citigroup where the number of shares sold short actually exceeds the number of shares in existence.  The group he named was essentially a who's who of hedge funds and fraudsters and included many names of prominent politically active 'reformed' criminals from the S&amp;L days on Wall St. I can't remember how the cards fell, but the scheme allegedly involved Michael Milliken, Sam Antar (from Crazy Eddie's Fraud), Gary Weiss, Jim Cramer, etc etc.   It was a fascinating story.   Byrne actually followed through with several lawsuits (one of which was settled after a Rocker Partners paid Byrne $5 million dollars to settle).   The 'Deep Capture' site is down, but I [found a decent article](http://www.theregister.co.uk/2008/10/01/wikipedia_and_naked_shorting/print.html) that sums up some of the shenanigans, including a journalist sock-puppeting to edit Wikipedia, repeatedly denying it, being IP-traced to inside the DTCC building (the Wall St. entity responsible for clearing trades, including naked shorts). No. You shorted the stock so you are not a shareholder. If you covered your short, again you are not a shareholder as you statement of account must show. You cannot participate in the net settlement fund. Answers here are correct but I'll offer an extremely (overly) simple explanation that should help you in understanding the more detailed answers.  When most people own stock they do so through a broker.  Unless you jump through some hoops, the broker keeps the shares in the name of the brokerage.  This is called holding the stock in street name. When you sell short through a brokerage, the broker is letting you borrow a certain number of shares owned by someone else and sell them for cash now.  At some point, you need to repay this loan with the same number of shares you borrowed.  Ideally, you want the stock to drop to $0.  The reason you might be forced to purchase the stock is that the actual owner(s) of the stock want to sell.  If the broker has too many people wanting to sell, you will need to repay some of all of the loan (in shares) i.e. purchasing shares at the current market price. You could hold a long position in some company XXXX and then short your own shares (assuming your broker will let you do that).  The dividend that would have gone to you would then go to whoever is holding the shares you short sold.  You just don't get a dividend.  If you're going to short in a smart way...  do it on a stock you otherwise believe in, but use it to minimize the pull-backs on the way up. I have heard of this, but then the broker is short the shares if they weren't selling them out of inventory, so they still want to accumulate the shares or a hedge before EOD most likely - In that case it may not be the client themselves, but that demand is hitting the market at some point if there isn't sufficient selling volume.    Whether or not the broker ends up getting all of them below VWAP is a cost of marketing for them, how they expect to reliably get real size below vwap is my question. "Concerning the general problem of short selling and the need to borrow shares to complete the transaction : Selling short is a cash transaction.  Unlike a futures contract, where a short seller is entering into a legal agreement to sell something in the future, in the case of short selling a share the buyer of the share is taking immediate delivery and is therefore entitled to all of the benefits and rights that come with share ownership.  In particular, the buyer of the shares is entitled to any dividends payable and, where applicable, to vote on motions at AGMs.  If the short seller has not borrowed the shares to sell, then buyer of non-existent shares will have none of the rights associated with ownership. The cash market is based on the idea of matching buyers and sellers.  It does not accommodate people making promises. Consider that to allow short sellers to sell shares they have not borrowed opens up the possibility of the aggregate market selling more shares than actually exist.  This would lead to all sorts of problematic consequences such as heavily distorting the price of the underlying share.  If everyone is selling shares they have not borrowed willy-nilly, then it will drive the price of the share down, much to the disadvantage of existing share holders. In this case, short sellers who have sold shares they have not already borrowed would be paying out more in dividends to the buyers than the total dividends being paid out by the underlying company. There are instruments that allow for short selling of unowned shares on a futures basis.  One example is a CFD = Contract for Difference.  In the case of CFDs, sellers are obliged to pay dividends to buyers as well as other  costs related to financing. EDIT Regarding your comment, note that borrowing shares is not a market transaction.  Your account does not show you buying a share and then selling it.  It simply shows you selling a share short.  The borrowing is the result of an agreement between yourself and the lender and this agreement is off market.  You do not actually pay the lender for the shares, but you do pay financing costs for the borrowing so long as you maintain your short position. EDIT I realise that I have not actually read your question correctly.  You are not actually talking about ""naked"" short selling.  You are talking about selling shares you already own in a hope of maintaining both a long and short position (gross).  The problem with this approach is that you must deliver the shares to the buyer.  Otherwise, ask yourself what shares is the buyer actually buying if you want the bought shares to remain in your account. If you are not going to deliver your long position shares, then you will need to borrow the shares you are selling short for the reasons I have outlined above." When you set up a short sale for equities you are borrowing stock from someone else; typically another client at the broker.  The broker usually buries an agreement to let your shares be borrowed for short sales in your account details.  So if Client A wants to short a stock, he borrows stock from Client B to do the short sale (it's usually not this direct as they can borrow from many clients).  If Client B then wants to sell his shares; if the broker can't shift around assets to find another client's shares to let Client A borrow; then he has to close the short position out because he doesn't have the shares in the brokerage to let Client A borrow to short anymore. "A stock split can force short sellers of penny stocks to cover their shorts and cauuse the price to appreciate.  Example:  Someone shorts a worthless pump and dump stock, 10,000 shares at .50.  They have to put up $25,000.00 in margin ($2.50 per share for stocks under $2.50).  The company announces a 3 to 1 split.  Now the short investor must come up with $50,000.00 additional margin or be be ""bought in"". The short squeeze is on." What a pointless list!  It's ranked by total short interest outstanding.  That's completely meaningless.  For instance, a $1 billion company with $1 billion in shorts (meaning the market thinks it's bankrupt) would be ranked much better than a $100 billion company with $1.1 billion in short interest.  tl;dr:  pure and utter bullshit You just disclosed that you are new investor to the stock market. I'd advise that you first understand investing a bit better, as most will advise that investors need to be above a certain level before picking individual stocks.  That said, most stocks trade in high enough volume and have low enough short interest that they don't fall under the category you seek. You want to first ask your broker if they have such a process, not all do. If so, they would need to provide you with the stocks that fall into this odd situation, specifically, the shares that have traders seeking to short the stock, but the stock is unavailable. Even then, the broker may have requirements that you don't fall into, minimum history with broker, minimum size account, etc. Worse, they are not likely to offer this for 100 shares, but may have a 1000 or higher share requirement. Are you willing to buy some obscure $50/sh priced stock to lend out at 1%/mo? The guy trying to short it is far smarter than both you and I, at least regarding this particular stock. This strategy is more appropriate for the 7 figure net worth investor.  If any reader has actual experience with this, I'm happy to hear it. This response is from my recollection of two articles I read about 3 years ago, coincidence they both were published within weeks of each other. "The reason for selling a stock ""short"", is for when you believe the stock value will decrease in the near future. Here is an example: Today Exxon-Mobile stock is selling for $100 / share. You are expecting the price to decrease, so you want to short the stock, which means your broker (i.e. eTrade, etc) allows you to borrow shares without paying money, and those shares are transferred into your account, and then you sell them and receive money for the sale. But you didn't actually own those shares, you only borrowed them, so you need to return the shares to your broker sometime in the future.  Let's say you borrow 10 shares @ $100, and you sell them at the market price of $100, you receive $1,000 in your account. But you owe your broker 10 shares, which you need to return sometime in the future. A few days later, the share price has decreased to $80. Now you can buy 10 shares from the market at a total cost of $800. You get 10 shares, and return those shares to your broker. Since you originally took in $1,000, and you just paid out $800, you keep a resulting profit of $200" Timothy Sykes specializes in this type of trade, according to his website. He has some recommendations for brokers that allow shorting low-priced stocks: "As @ApplePie pointed out in their answer, at any given time there is a finite amount of stock available in a company. One subtlety you may be missing is that there is always a price associated with an offer to buy shares. That is, you don't put in an order simply to buy 1 share of ABC, you put in an order to buy 1 share of ABC for $10. If no one is willing to sell a share of ABC for $10, then your order will go unfilled. This happens millions of times a day as traders try to figure the cheapest price they can get for a stock. Practically speaking, there is always a price at which people are willing to sell their shares. You can put in a market order for 1 share of ABC, which says essentially ""I want one share of ABC, and I will pay whatever the market deems to be the price"". Your broker will find you 1 share, but you may be very unhappy about the price you have to pay! While it's very rare for a market to have nobody willing to sell at any price, it occasionally happens that no one is willing to buy at any price. This causes a market crash, as in the 2007-2008 financial crisis, when suddenly everyone became very suspicious of how much debt the major banks actually held, and for a few days, very few traders were willing to buy bank stocks at any price." Yes in order for you to short a stock, some one has to be willing to lend it to you to short, the more people that want to short this stock, the higher the borrowing rate is to short it. in some instances such as groupon so many people are shorting it that there are practically no shares left to short and if you do end up getting some it would be at a very high borrowing cost. Michael gave a good answer describing the transaction but I wanted to follow up on your questions about the lender. First, the lender does charge interest on the borrowed securities. The amount of interest can vary based on a number of factors, such as who is borrowing, how much are they borrowing, and what stock are they trying to borrow.  Occasionally when you are trying to short a stock you will get an error that it is hard to borrow. This could be for a few reasons, such as there are already a large amount of people who have shorted your broker's shares, or your broker never acquired the shares to begin with (which usually only happens on very small stocks). In both cases the broker/lender doesnt have enough shares and may be unwilling to get more. In that way they are discriminating on what they lend. If a company is about to go bankrupt and a lender doesnt have any more shares to lend out, it is unlikely they will purchase more as they stand to lose a lot and gain very little.  It might seem like lending is a risky business but think of it as occurring over decades and not months. General Motors had been around for 100 years before it went bankrupt, so any lender who had owned and been lending out GM shares for a fraction of that time likely still profited.  Also this is all very simplified. JoeTaxpayer alluded to this in the comments but in actuality who is lending stock or even who owns stock is much more complicated and probably doesnt need to be explained here. I just wanted to show in this over-simplified explanation that lending is not as risky as it may first seem.