Aug
20
2010
When you make a decision to act upon a stock, you are "Taking a Position." There are two kinds of positions you can take:
1. A Long or
2. A short position
Taking a long position means buying the stock based on the belief that the price will rise, therefore taking at long, or bullish position.
The short position is a little more complicated. In shorting you sell the stocks and then buy them back when the price falls, earning you a profit.
If you don't own shares of XYZ stock but you ask your broker to sell short 100 shares of XYZ you have committed shorting.
In broker's lingo, you have established a short position in XYZ of 100 shares. Or, to really confuse the language, you hold 100 shares of XYZ short.
Why would you want to short?
When you make a decision to act upon a stock, you are "Taking a Position." There are two kinds of positions you can take:
1. A Long or
2. A short position
Taking a long position means buying the stock based on the belief that the price will rise, therefore taking a long, or bullish position.
The short position is a little more complicated. In shorting you sell the stocks and then buy them back when the price falls, earning you a profit.
If you don't own shares of XYZ stock but you ask your broker to sell short 100 shares of XYZ you have committed shorting.
In broker's lingo, you have established a short position in XYZ of 100 shares. Or, to really confuse the language, you hold 100 shares of XYZ short.
Why would you want to short?
While the U.S. Markets are constantly a Roller Coaster of energetic fun, one Rule stays true.
Whether we be in a Bull Market, or a Bear Market, you must ALWAYS keep a level head. Emotions cloud your judgment, and reduce your profits!
By always having STRICT Trading Rules set in place, you are sure to do better than the average investor.
Stop Losses, Trailing Stop Losses; Limit Orders are just some of the practices used by pros that can help you maximize your profits, while greatly reducing your downside (Risk).
We highly recommend signing up to the ChartPoppers.com Newsletter where you will receive our FREE Ebook "Investors Edge" PLUS weekly Updates on select Emerging Growth Trading Opportunities.
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