Short trades - Index futures

[PCR]

Hi, i am having difficulty in understanding how trades get shorted. If an underlying is bought at lets say 1 contract; how can this realise a profit if the contract declines in value? Regards Charles

[SimonPB]

to short you don;t buy, you sell .. then when it fals you buy it back

[Pluto]

It goes like this: You borrow a contract and immediately you sell it at a high price. You wait for it to fall in price and then you buy it back at a lower price and immediately give it back to who you borrowed it from - collecting the difference between the high selling price and lower buying price.

[PCR]

txs guys confusing the absract - you buy a contract (sell) and sell a contract (buy) :)

[Vano]

@PCR, perhaps it would be less confusing if explained this way: You borrow (say) 100 shares from some one. You sell the 100 shares which you borrowed. You are now SHORT of 100 shares, which you need to give back. You buy the 100 shares back at a lower p

[PCR]

txs Vano, understand it much better now. Was a bit confusing on OST to check the option "sell" when you dont have a contract!

[prancing_horse]

The other thing to remember the chances are just as great that you'll be taking money out your pocket, (in fact with me it has been more so), than puting it in.

[WES]

Yes I agree, remember a bear market or pullback or correction downwards ect is normaly fast and furouis whereas a bull market or rally takes longer, it means that your timeing on shorts has to be perfect. If you not sure dont do it.

[Mar-11]

when short, you are effectivly negative contracts,if u look at holding negative contracts very simple to understand... so u profit on down moves(2x negative=positive), and lose on up moves( neg*postive=neg)