Hi Dennis,
In order to short a stock, you need a margin account. If you are a new trader, you probably don't have one -- call your broker to set one up.
Once you have set up your margin account, it must have positive equity. That is, you must own more than you owe in your margin account. If you have no short positions, then you would only have a negative equity if you have bought on margin.
Finally, to sell short, your broker must have shares to lend you. For RMBS, getting shares to short has been touch and go -- sometimes they're available, sometimes not. You may have to be put on a waiting list.
Once you have the shares, you tell your broker to sell them short for you.
That's it!
A word of caution: selling short is risky. There is no theoretical limit to how much you can lose. Be careful.
Call your broker and ask him:
- do you have a margin account?
- are there shares of RMBS available?
- How many can you short with your current margin equity?
Please, do not rely on any information I give you. Instead, make sure you talk at length to your broker, or other qualified professional.
Good luck.
Sincerely,
John Wallner
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