Short selling is a way of operating financial assets, as opposed to long selling. Short selling is to borrow the underlying assets first, then sell them to get cash, and after a period of time, pay cash to buy the underlying assets and return them. So how do you make money by shorting stocks?

In fact, the way to make a profit by shorting is easy to understand. Contrary to the commonly understood way of long profit, short profit is a way to borrow the underlying assets first, then sell them at a relatively high price to get cash, and after a period of time, spend cash to buy the same underlying assets with reduced prices and return them, thus obtaining the intermediate price difference income.

At present, A-shares can make profits by short selling through margin financing and securities lending. In addition, you can also make short profits by participating in stock index futures trading and commodity futures trading.

Give a simple example.

Shareholder Xiao Zhang borrowed 10000 shares of Company A, the underlying asset, and sold them at the current market price of 10 yuan to obtain cash of 10000. After that, the stock of Company A fell by 50% from 10 yuan, and the market price became 5 yuan dollars per share. At this time, shareholder Xiao Zhang chose to buy back 65,438+00,000 shares of Company A at the market price of 5 yuan money per share, and spent 50,000 yuan to return the shares.

In this process, the stockholder Xiao Zhang is shorting, and through shorting, he gains a profit of 100000-50000=50000 yuan.