Short selling is an investment term such as stock futures: for example, when you expect a stock to fall in the future, sell the stock you own when the current price is high, and then buy it when the stock price falls to a certain level, so the difference is your profit. Short selling refers to selling stocks at the current price in the expectation of future market decline, and buying them after the market decline to make a profit. It is characterized by the trading behavior of selling first and then buying.

Short selling is a common operation mode in stock futures market. It is expected that the stock futures market will have a downward trend. The operator will sell his chips at the market price, and then buy them after the stock futures fall to earn the middle price difference. Shorting is the opposite of doing long. Theoretically, it is to borrow goods to sell first and then buy them back. Generally, the regular short-selling market has a platform for third-party brokers to borrow goods. Generally speaking, it is similar to a credit transaction. This model can profit in the wave band of falling prices, that is, borrowing goods at a high level and selling them, and then buying and returning them after falling. So buying is still low, selling is still high, but the operating procedures are reversed.

Common functions of shorting include speculation, financing and hedging. Speculation refers to the expectation of future market decline, and then sell high and buy low to obtain the profit difference. Financing means shorting in the bond market and returning it in the future, which can be used as a way to borrow money.

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Short-Baidu encyclopedia