Stack Exchange Network

Stack Exchange network consists of 174 Q&A communities including Stack Overflow, the largest, most trusted online community for developers to learn, share their knowledge, and build their careers.

Visit Stack Exchange

For questions related to the trading practice of short-selling, which involves selling securities or financial instruments that one doesn't own with the intention of repurchasing them at a lower price.

0
votes
4answers
181 views

Does short-selling hurt companies' stock price in the long-term?

Today, I've read a Bloomberg article on latest Musk tweet tantrums, where he, among other things, mentioned this: Short-sellers are value destroyers. Should definitely be illegal. Is that ...
1
vote
2answers
35 views

does naked call option assignment result in stock borrowing fees?

If I write a naked call option which gets exercised early, will I have a chance to purchase the stock to cover the call or will I already owe a stock borrow fee by the time I am notified of the ...
-4
votes
1answer
245 views

I'm quite confused about the meaning of short selling. Does it drive people to do crimes? [closed]

If someone short-sells a lot of stock and then murders the company's CEO, he could make a large profit. Maybe murder is too extreme an example, however, perpetrating any crime against that company ...
2
votes
1answer
114 views

Selling short during short circuit breaker

Imagine a stock went down more than 10% intraday, triggering the short circuit breaker, aka Alternative uptick rule. Short selling is only possible higher than the best bid. But what happens exactly? ...
2
votes
1answer
64 views

How does selling a stock short affect my cash and margin positions in my account?

Example of my etrade account: I have $3k cash and $0 margin debt and my account net balance shows $50k. I then sell to open a $4k position in XYZ how does this impact the cash, margin and net balance?...
2
votes
3answers
393 views

Vegan hedge (shorting non-vegan, long vegan)

Edited in response to comments. How could I isolate a bet on veganism? (Assume that most of my wealth is already invested passively in diversified index funds and that for alpha with a different ...
0
votes
1answer
72 views

short selling time frames?

My understanding of short selling is... let's say you sell stock for $50 a share. If you purchase the stock for delivery two days later for $40 and then ship it you've effectively realized a profit ...
0
votes
2answers
121 views

Does short selling create additional share in the market?

Let's say that I short-sell 1 share that A lent to me and B immediately bought from me. Doesn't this create additional share in the market because A will see it as "lent out" in his bank account and ...
3
votes
3answers
295 views

What happens to a short seller, who wants to close his position, but there are no shares available for sale?

For the sake of argument, let's assume a scenario, where the company is very illiquid, and there are no shares for sale and even increasing the buy order doesn't produce sellers. What happens to the ...
2
votes
1answer
182 views

I don't understand what it means to “Sell” stock that you don't already own, can someone explain the intuition behind it? [duplicate]

I started a couple months ago to learn more about the stock market and financial education in general, but this particular concept was hard to wrap my head around. I understand there are bears and ...
17
votes
2answers
3k views

Shorting a stock after dividend

Theoretically, the price of a stock should always fall whenever a dividend is paid out to shareholders. Is this true in practice? If it is, I can just short the stock before the dividend is paid and ...
-1
votes
2answers
82 views

Covering my short sale

Will anything happen if I don't cover my short? Is there a time limit for when the bank forces me to cover it? Will they close my account if I don't cover? Thanks
2
votes
1answer
1k views

Can I short a stock for a long amount of time?

The next recession is inevitable, if what I read is to be believed. Whether it happens tomorrow, or in 10 years, it's coming. Why shouldn't I short many stocks, and hold on to them for whatever ...
1
vote
4answers
69 views

Call vs Puts: a short position can profit using both depending on strike price?

I'm confused about whether you want to own a call or put if you believe a stock price will go down. Most articles have described owning Puts as betting the stock will go down, and calls as betting ...
13
votes
3answers
4k views

Why do speculators short-sell a stock when they wish to go short, rather than purchase put options?

I'm still trying to figure out, why, if a speculator believes a security will go down in value they use the tradition route of short-selling, when it would seem that purchasing put options is the less ...
1
vote
1answer
75 views

Why did SPVXSPIT drop 95% in February?

In February 2018, SPVXSPIT (S&P 500 VIX Short Term Futures Inverse Daily Index) seems to have dropped about 95%, but after much googling, there does not seem to be any discussion about this. The ...
-1
votes
2answers
408 views

Profiting from an economic bubble collapse

An article in Business Insider argues that, despite the numbers, the US economy is fundamentally unhealthy. The current unprecedented corporate profits are essentially being subsidized by low quality ...
1
vote
1answer
130 views

Predicting a short squeeze

I have been following Tesla (TSLA) and I think there may be a short squeeze occurring. I was wondering if there are any tell tale signs, for when a short squeeze is occurring?
1
vote
1answer
71 views

Is possible to short sell stocks without using CFD?

the title is all my question :) Is possible to short sell stocks without using CFD?
2
votes
4answers
583 views

Sellers won't sell back shares in a short sale?

I'm trying to understand the concept of short selling shares in a bear market. Here's what I understand so far. Person A owns 100 shares Person B borrows 100 shares from Person A without Person A's ...
0
votes
1answer
54 views

Fine-tuning index fund positions

In general, passive mutual funds (as well as ETFs) provide a good way to diversify without keeping track of and/or a large number of separate securities or paying high additional expenses. However, ...
0
votes
0answers
326 views

How to view short interest of a stock on ThinkOrSwim

This how-do-i-find-short-interest-for-a-stock article shows how to find short interest of a stock on Nasdaq.com and Yahoo.com/finance. I would like to consolidate my data sources to a single platform,...
0
votes
1answer
123 views

What is the issue with naked shorts?

As I understand it, in the USA it is illegal to short (sell) an underlying asset without a counter-party that lends the asset (naked) for the sale. From the trader's perspective, why does it matter if ...
37
votes
4answers
9k views

How to profit off a stock price falling

How would one profit from a share price falling, granted that they correctly predicted it would happen? Say I had a hunch that a certain stock was going to fall next week, how could I effectively ...
-1
votes
3answers
173 views

By pass the 100% limit in shorting: Capitalising on a Market Crash

I want to short a cryptocurrency that is highly overvalued. Let say its current value as of now is $10,000 , my intuition say that sometime next year like Feb its going to fall significantly to about $...
1
vote
2answers
114 views

How can a retail investor short the German car industry and its suppliers?

Suppose that I want to make a small investment of around 1000€ and that I want to short the German car industry and its suppliers over the long term (5-15 years). How would you do this?
4
votes
0answers
367 views

How do I short bitcoins? [closed]

Canadian investor looking to short this bitcoin surge. Are there any methods one might use (perhaps with options trading) to short bitcoins (either in Canada or US)? I'm not asking for specific ...
2
votes
0answers
136 views

Can a buyout announcement cause a short squeeze above the announced takeover price?

Consider a company with heavily shorted stock. If that company puts itself up for sale and a friendly (shareholder approved) acquisition happens, can it result in a short squeeze driving the price of ...
1
vote
2answers
128 views

What is the long side of a short transaction called?

The way that a short sale occurs is that a person called the short seller borrows the item to be shorted from someone else and then sells it. The debt is for the item itself, so as long as it is ...
0
votes
1answer
50 views

What's wrong with this margin calculation?

I'm calculating margin on put selling options using TDAmeritrade's formula. It can be found here on p.11: https://www.tdameritrade.com/retail-en_us/resources/pdf/AMTD086.pdf Using the first example ...
1
vote
1answer
99 views

Simultaneous long/short India

I know its not legal to have open long and short position on specific security (on two stock exchanges - NSE/BSE), but where exactly is this restriction defined (SEBI regulation? where can I find it?) ...
0
votes
1answer
83 views

What price side am I paying when shorting stock / future

I know that question was asked here numerous times but I don't think it was ever answered clearly. When I'm short selling a security (stock/future...) I pay a bid price (with a MKT order - when I ...
0
votes
1answer
217 views

Why can't I open multiple sell orders?

I have bought few EARS shares in Jan (300) and May(500). I am still learning stock market basics. But now, I can not sell 500 shares in profit. Whenever I tried to make trade on Fidelity; I am ...
-3
votes
1answer
104 views

What causes the asymmetry between being long and short in a stock?

What causes the asymmetry between being long and short in a stock? If I go long (no leverage) on a stock that rises from $1 to $1000 I can turn $1000 into $1,000,000, a 99,900% profit If I go short (...
2
votes
2answers
207 views

Short selling - lender's motivation

It is not clear to me how the lender of the shares profits at all from short selling. The broker profits by lending the shares to someone else and then getting paid interest The short seller profits ...
7
votes
2answers
988 views

Is the money you get from shorting a stock free to use for going long on other stocks?

I shorted a particular stock which resulted in $10,000 being deposited into my Interactive Brokers account. I then put all of that $10,000 into VTI (total stock market index). Basically making the bet ...
2
votes
2answers
570 views

How can one go short in Uber?

I believe Uber is massively overvalued and it will face down rounds in the near future. Assuming I can use all financial instruments, how could I short Uber?
3
votes
1answer
128 views

understanding the process/payment of short sale dividends

Reference the log/journal entries below... I'm trying to follow the accounting trail for the following scenario. 10/04/16  20:36 Sold 5 SPY 12/30/16 220 Call @2.52 $1,255.41 12/16/16  03:17 OPT ...
1
vote
1answer
330 views

How do I short government bonds?

Perhaps it's because I've just watched The Big Short, but I'm bearish on Italian Government bonds right now. How would I go about shorting government bonds?
1
vote
2answers
87 views

Differences between hedge funds and short selling

Both hedge funds and short take advantage from bearish markets, but what is the difference between them?
0
votes
1answer
823 views

Are spot market ,regular market and ready market same in stock trading if not then what is the difference?

Are spot market ,regular market and ready market same in stock trading if not then what is the difference ? and is short selling margin trading ?
2
votes
0answers
931 views

What is a Rebate rate when short selling shares

Investopedia says: The amount paid by a stock lender to a borrower who has put up cash collateral to borrow a stock. The stock loan rebate comes from the reinvestment of the cash collateral by the ...
0
votes
1answer
131 views

What happens with the “long” buyer of a stock when somebody else's short fails (that is, unlimited loss bankrupts short seller)

I am a long buyer. That is, I buy and hold and essentially never let go (my profits come from dividends). What happens when I buy a stock on the market that turned out to be somebody else's short, ...
-3
votes
6answers
1k views

Buying and selling the same stock

If I buy a stock for say $1 and that stock goes up to $2, can I sell my initial investment being $1 and then buy back into the same stock when it goes back down to $1 over and over only using my ...
2
votes
1answer
153 views

How would I prove my claim in a class action settlement on a “stock misconduct” case when I shorted the stock?

In order to participate in a net settlement fund, a claimant must have "purchased or otherwise acquired stock". If I shorted does the stock did I "purchase it or otherwise acquire it"?
1
vote
3answers
105 views

Shorting Stocks And Margin Account Minimum

As I understand in order to put in a short order, one must have at least 150% of the trade value in their trading account. For example, if I were to short 200 shares of a stock which is currently ...
2
votes
2answers
374 views

Schwab wants to charge me interest on the money I received for selling TSLA short

Has anyone ever heard of a company charging you interest on short position? Should I try and open an account somewhere else if I want to short TSLA? This will cost me about $13 a day. I was called ...
1
vote
2answers
333 views

It's possible to short a stock without paying interest?

Is it possible to short a stock or stock CFDs without paying any interest or swap fees for mantaining the position? Thank you.
21
votes
9answers
5k views

Why do shareholders participate in shorting stocks?

When an investor wants to short a stock, they need to borrow shares from someone else. Why would a shareholder lend the investor the shares? When the investor gives them back, the stock would be down....
34
votes
3answers
7k views

Can I profit from anticipating a drop in value?

Suppose there is an investment, such as a stock, which I currently own no units of. I predict this investment will soon drop in value. I have no reason to predict that the investment will bounce back ...