I do not short a stock. Never have. I do wish to know more about the rules on how to go about shorting a stock though. I understand that different institutions have different rules and criteria for shorting, but I'm sure that they all share some basics.

What I know:

The initial transaction is a counterintuitive 'sell', where the trader sells borrowed shares  on the promise to 'buy' them back later. If the stock loses value, the trader makes money.

Now, when shorting, certain conditions need to be present. Can anyone tell me, in a nutshell, what these conditions are?

I am asking because yesterday's MOC trade by Canaccord stinks and am wondering if that trade was performed to set up a short position with traders on the other side of the transaction?