First of all, the basic logic of short selling and short selling is different. Short investors will pay attention to the fundamental and technical analysis of a certain variety, make their own predictions about the market trend, and then choose to buy a certain price and wait for the price to rise and make a profit. The risk of short selling is that if the market trend is inconsistent with the forecast and the price falls, investors will face losses. Short selling is the opposite operation. Sell a certain price first, wait for the price to fall, and then buy back the varieties whose price is lower than the selling price to make a profit. The risk of short selling is that if the market trend is inconsistent with the forecast and the price rises, investors will face losses.
Secondly, the market conditions of short selling and short selling are different. The market situation of short selling is usually bullish, that is, the market generally expects the price of a certain variety to rise, which in turn drives a large number of investors to buy, thus pushing up the price. Short selling requires the market to be bearish, that is, the market generally expects the price of a certain variety to fall, which in turn drives a large number of investors to sell, thus driving down the price. In the bull market, short sellers can take advantage of the trend and get greater profits; Short sellers, on the other hand, need to have high forecasting and risk control ability in order to obtain stable income. Similarly, in a bear market, the risks and opportunities of short selling and short selling are different.
Third, short selling and short selling have different risk control. Short investors, once buying a variety, can choose to buy when the market price falls to reduce the risk; Short selling, on the other hand, needs to buy back varieties as soon as the market price rises to control risks. Therefore, shorting has more advantages in risk control, which can control the cost of holding positions and have sufficient time and means to deal with unfavorable market conditions. Short-selling investors need stricter risk control mechanism, and at the same time, they need to always pay attention to market dynamics and adjust their operational strategies in time.
To sum up, short selling and short selling are similar on the surface, but there are great differences in mechanism, market conditions and risk control. Investors need to choose the appropriate operation strategy according to their own experience, financial strength and market conditions, in order to obtain the maximum income and the minimum risk.