NEW YORK, May 27 (Reuters) - Short interest on the NYSE

rose 1.7% in mid-May, the exchange said on Monday.

As of May 15, short interest rose to about 18.456 billion

shares on NYSE Group, which includes the NYSE, NYSE Arca and

NYSE American exchanges, compared with 18.143 billion shares as

of April 30.

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.