That’s a good question I dont have an answer to. Maybe there are ways to short where you can just hold, but I dont know how. Maybe there’s a way to borrow lots of RAM and GPUs, sell them, then buy them back when the price drops and sell them for cheap back to whom you borrowed. But I dont know who would make that deal.
You can hold a short position by repeatedly borrowing more stock – but you run the risk of running out of money completely, because short positions have (theoretically) infinite downside risk.
Financial risks can, by themselves, never be infinite. They are by nature quite finite. Also, risks are always alluding to a downside. Otherwise they’re called chances.
Granted. “Arbitrarily large” would probably be a better phrasing: if I buy a stock for $100 and the value drops to $0, I’m out $100. Can’t lose more money than I put in. What I meant is that short positions, by their nature, don’t have this ceiling on the amount of money you lose.
That’s a good question I dont have an answer to. Maybe there are ways to short where you can just hold, but I dont know how. Maybe there’s a way to borrow lots of RAM and GPUs, sell them, then buy them back when the price drops and sell them for cheap back to whom you borrowed. But I dont know who would make that deal.
You can hold a short position by repeatedly borrowing more stock – but you run the risk of running out of money completely, because short positions have (theoretically) infinite downside risk.
Financial risks can, by themselves, never be infinite. They are by nature quite finite. Also, risks are always alluding to a downside. Otherwise they’re called chances.
Granted. “Arbitrarily large” would probably be a better phrasing: if I buy a stock for $100 and the value drops to $0, I’m out $100. Can’t lose more money than I put in. What I meant is that short positions, by their nature, don’t have this ceiling on the amount of money you lose.