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.
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.