What is the primary goal of an investor who engages in a short sale?

The primary goal of an investor engaging in a short sale is to profit from a decrease in the price of the security. When an investor short sells a stock, they borrow shares and sell them in the market with the expectation that the stock price will decline. If the price does drop, the investor can then buy back the shares at the lower price, return them to the lender, and pocket the difference as profit.

In contrast, holding shares for long-term growth focuses on buying and retaining investments with the anticipation of price appreciation over time, benefiting from capital gains rather than taking advantage of downward market movements. Generating income from dividends emphasizes a strategy where investors seek consistent income from dividends rather than trading based on price fluctuations. Acquiring shares for a company takeover involves strategic acquisition with the intent to control or influence the company, which is not aligned with the speculative nature of short selling. Thus, the motivation behind a short sale is distinctly tied to the prospect of declining prices, making the choice to profit from a decrease in the price of the security the most accurate answer.