When someone is short in a stock what does this mean??
Heres a example– There have been 3 mil short since Nov 2005, at current avg volume (295.000) it's 10 days to cover, The first 2 mil shares got in at about 6.50 avg so they've got some room to cover.
Heres a example– There have been 3 mil short since Nov 2005, at current avg volume (295.000) it's 10 days to cover, The first 2 mil shares got in at about 6.50 avg so they've got some room to cover.
When trading stocks, bonds or tulip bulbs you need a buy and a sell. It does not matter what order you execute this in. A buy and a sell result in a zero sum. If you buy first you are "long". You do not actually take possesion of anything, it is only a paper position. Once you sell, your net position is 0.
Likewise, if you sell first you become "short". You theoretically borrow the shares you are short. Once you buy you net position is again 0.
In both cases the ideal scenario is to buy low and sell high. Or better yet to buy high and sell higher!
The opposite is also true. If you believe that the market you are trading is going to drop then you sell first, hoping to buy back at a lower price.
Likewise, if you sell first you become "short". You theoretically borrow the shares you are short. Once you buy you net position is again 0.
In both cases the ideal scenario is to buy low and sell high. Or better yet to buy high and sell higher!
The opposite is also true. If you believe that the market you are trading is going to drop then you sell first, hoping to buy back at a lower price.
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