Konubinix' opinionated web of thoughts

Short Selling


Short selling is like a bet on the decline in price.

You “borrow” some financial asset, so that you can sell it now and bet on the fact it will have decline in price and that you will be able to buy it at a lower price when you will have to give it back.

When some big institution, like a edge fund, is known to short sell something, this sends to the market a loss of trust in the product, inducing a will to sell the actions while they still have some value. Then this may induce the wanted decline in price.

Short selling is the practice of selling borrowed securities – such as stocks – hoping to be able to make a profit by buying them back at a price lower than the selling price.


then you sell short a stock, you’re looking to profit from a decline – rather than an increase – in price


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