Short selling is the reverse operation of doing long. Theoretically speaking, it is to borrow first, then sell, then buy and then return. The formal short-selling market is a platform for third-party securities companies to provide loans. Generally speaking, it is similar to a credit transaction.
In the period of falling prices, this model can be borrowed and sold at a high level, and then bought and cashed back when prices fall to make a profit. In this way, the purchase volume is still low and the sales volume is still high, but the operation procedure is reversed.
For example, one price of Shanghai futures gold is 200 yuan/gram. After analysis, the market will fall. So I opened a position in 200 yuan, made a short-term order, and waited for the price to fall. After the opening, the price actually dropped to 195 yuan/gram. What we need to do at this time is to close the position. Then the profit is 5 yuan/gram, one hand1000g, five times1000g, and the profit is 5,000 yuan.
Extended data:
The difference between short selling and stop loss:
The biggest difference between short selling and stop loss is that after the stop loss is sold, it may not be bought back, and the financial loss caused is very realistic and cruel. Short selling means buying back on dips after selling, and making profits by reverse operation without expanding the loss of the original quilt cover. Therefore, short selling is more acceptable to investors than stop loss. Compared with stop loss, investors have more stable mentality, more decisive actions, lower error rate and higher success rate.
Baidu encyclopedia-short
Baidu encyclopedia-short futures