What is Short Selling and How to Benefit From It?
What is Short Selling and How to Benefit From It?
Short Selling is a strategy in which a trader sells a commodity or security that he or she does not own in order to profit from a falling market.? In this trader will borrow the commodity or security from his broker, who usually in turn has borrowed the shares from some other investor who is holding his shares then immediately sell on to the buyer. At a later date, the trader must buy back the commodity or security from the market to close the position.? If the value of the commodity or security has fallen during this period the short selling trader?s profit will be the difference between his original sale price and the buyback price.
Short selling is strategy to express bearish view point of trader towards a commodity or security. Essentially this is another face of coin in any freely traded commodity where trader feel that current value
