Shares/Stocks statistically have around 60% likelihood of going up on any particular trading day. I think this is a good place to start when thinking about utilising a short selling strategy. We also know that in the most recent generation, down days in the market tend to be larger than corresponding up days. Of course you may have already twigged that this bias is the basis for the relative recent success of Passive/Buy & Hold Index investing.
So armed with this info, for simplicity sake my preference is for utilising shorts through the stock index. That is generally be long the stocks that your investing idea's favour, and overlay your portfolio with index insurance (shorting when suitable). Naturally many investment advisors will call this method folly, and they may have industry wide statistics that back their case, but I also know all of these same advisors would be unable to survive from trading the market. In other words we all have a method that suits our particular purpose.
The most popular method of shorting is by actually shorting individual stocks amongst your portfolio. This is usually done by inverting your investing criteria, that is searching for expensive stocks as opposed analysing cheap stocks.
For more info I link an article from Roger Montgomery:
Short-Selling As A Mainstream Investment Strategy
"A role for short-selling
The mathematician Herbert Stein once observed, “if something cannot go on forever, it will stop.” Investors, however, are not only ill-prepared for any reversal, they are ill-equipped. All of their investments are in assets that benefit from rising prices, and thanks to the 30-year decline in interest rates, not only have investors enjoyed rising asset prices, but they’ve been lulled into expecting those returns to continue.
Buying low and selling high, in that order, is the common way to generate wealth and preserve purchasing power. If, however, asset prices do not produce a large positive between the purchase and sale, and bouts of sharply declining prices ensue, selling first and buying later at lower prices, (or short selling as it is known), may not only enhance the possibility of greater returns but may also smooth them." - Roger Montgomery