NEW YORK - Short interest on the Nasdaq rose 1.3% in mid-September, the exchange said late on Monday.

As of Sept. 15, short interest rose to about 12.209 billion shares, compared with 12.052 billion shares as of Aug. 31.

Investors who sell securities 'short' borrow shares and then sell them, expecting the stock to fall so they can buy the shares back at the lower price, return them to the lender and pocket the difference.

Shorting can also be part of a hedging strategy.

(Reporting by Chuck Mikolajczak; Editing by Andrew Heavens)