Learn about Short Selling with iMinds Money's insightful fast knowledge series.
Short selling is the practice of selling borrowed stock at a high price and then buying back the stock at a lower price. A short seller expects to profit from the fall in a stock's price. The more common investment practice is to “go long”, that is, to buy stock with the expectation of the price rising in the future. Simply, a short transaction sells high and buys low, while a long transaction buys low and sells high.
A basic example is as follows. An investor believes that Company A stock is overpriced at $60 per share. The investor then borrows 100 shares and sells them for $6000. The price of Company A's shares then fall to $20. The investor buys 100 shares at $20 for $2000. The investor then returns the shares that have been borrowed and makes a $4000 profit.
iMinds will hone your financial knowledge with its insightful series looking at topics related to Money, Investment and Finance.. whether an amateur or specialist in the field, iMinds targeted fast knowledge series will whet your mental appetite and broaden your mind.
iMinds unique fast-learning modules as seen in the Financial Times, Wired, Vogue, Robb Report, Sky News, LA Times, Mashable and many others.. the future of general knowledge acquisition.
Short selling is the practice of selling borrowed stock at a high price and then buying back the stock at a lower price. A short seller expects to profit from the fall in a stock's price. The more common investment practice is to “go long”, that is, to buy stock with the expectation of the price rising in the future. Simply, a short transaction sells high and buys low, while a long transaction buys low and sells high.
A basic example is as follows. An investor believes that Company A stock is overpriced at $60 per share. The investor then borrows 100 shares and sells them for $6000. The price of Company A's shares then fall to $20. The investor buys 100 shares at $20 for $2000. The investor then returns the shares that have been borrowed and makes a $4000 profit.
iMinds will hone your financial knowledge with its insightful series looking at topics related to Money, Investment and Finance.. whether an amateur or specialist in the field, iMinds targeted fast knowledge series will whet your mental appetite and broaden your mind.
iMinds unique fast-learning modules as seen in the Financial Times, Wired, Vogue, Robb Report, Sky News, LA Times, Mashable and many others.. the future of general knowledge acquisition.
