This blog is more so for seasoned traders but individuals new to the game can file this under “important lessons”.
I don’t hear it discussed much in the trading community (at least the ones I visit) but someone I follow on Twitter wrote briefly about it in a blog.
Coincidentally, a week or so later, someone on Stocktwits sent me this message,
I wrote a poem about Losses,
check it out below.
What exactly is shorting?
If you’re new to investing or trading the stock market, I would STAY FAR AWAY FROM SHORTING. However, the more comfortable you get with trading and the more profitable you become, I believe it’s a must have in your trading repertoire. Essentially, shorting involves borrowing x amount of shares from your broker and selling it at a specified price (set by you) on the open market. At some point, you buy back the securities on the open market and return them to your broker. Thus, allowing you to bank mucho dollars!