Short Selling
I understand the concept of borrowing the shares and selling to the market and buying back cheaper. What I don’t understand is how to collect the cash if a profit is made. Where does the money come from? If someone is interested could you do a walkthrough on the trade from open to close?
30 sec Googling yields this:
Source: https://www.masterclass.com/articles/short-selling-explained#how-short-…
Thank you
Borrow their shares (brokerage handles this for you when you want to short)
Sell them at the spot value.
Wait.
Stock price drops. You buy those shares back at the lower value.
And you have now made the spread of when you sold and bought them back for cheaper.
Fugiat sint sunt eum qui pariatur eveniet. Qui sed consequatur error distinctio minima. Impedit aut id inventore voluptatem sed.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...