Short positions will have an impact on asset prices. When investors are short, it will increase the selling pressure, leading to a decline in asset prices. This will further attract more investors to short. Short positions will aggravate the downward trend of the market, thus making the market more unstable. However, when market sentiment changes, investors may also do more, thus pushing up asset prices.
Although short positions can bring benefits, they are also accompanied by risks. If market expectations fail to meet investors' expectations, prices may rebound rather than fall. This will lead investors to pay higher prices when buying back securities. Because it is impossible to predict the market situation, there is a high risk in shorting positions. In addition, if other investors lose confidence in your short position, they may sell securities immediately, which will lead to further decline in asset prices.