Being short on the market means that you are selling some marketable assets, expecting the financial instruments to lose value. The reverse of a short position is a long position.
- Being short on the market means that you are selling some marketable assets, expecting the financial instruments to lose value.
- The reverse of a short position is a long position.
If a trader expects that the selected financial instrument will lose value, then they usually take a short position on that instrument, in other words, they sell the instrument. The word ‘short’ in the phrase ‘short position’ has nothing to do with the amount of time a trader plans to hold the market position before it closes.
When trading shares, not CFD shares, taking a short position also involves borrowing shares from a broker. These shares are owned by the broker, and can only be borrowed by clients or partner brokers. Generally speaking, short selling can be defined as the sale of a financial instrument that is not currently in the position of the investor.
To learn more about how to take a long or short position on the xStation platform, feel free to read our article on How to Place an Trade on xStation 5.
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