Shorting is like - renting a $30,000 car from a rental company, and then selling it on the open market, because you expect that the price for that car will drop

Shorting is like - renting a $30,000 car from a rental company, and then selling it on the open market, because you expect that the price for that car will drop by more than $14,600 next year. During the year, you have to pay $40/day, so you pay the rental company $14,600 to rent the car for the year. At the end of the year, you buy an identical car and return it to the rental company. This is possible because cars are fungible in this example. If the car's market price goes down to $10,000, then $30,000 profit less $24,600 costs gives $5600 in revenue for the short. If the car's market price goes down only to $20,000, then $30,000 profit less $34,600 costs gives $4600 in loss for the short. ----- Naked shorting sounds like gaslighting - putting lots of ads in the paper that advertise this car for $5000, hoping to lower the price...and answering the phone that it's definitely available, even though someone already put a deposit down on it.