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The risk profile changes when you switch to an opposite strategy If you went long, and lost money, going short instead doesn't mean you would make money, it me
by cloudjacker 10y ago
The risk profile changes when you switch to an opposite strategy
If you went long, and lost money, going short instead doesn't mean you would make money, it means you could lose on the interest payments, you could lose on being forced to close, could lose on the different risk profile of having unlimited loss potential
Even more so with derivatives.
- samfisher83 10y agoThere are borrowing costs with shorting, but you usually don't go long on shorting stocks its more of short term thing. In that case borrowing costs are not too bad.