> The maximum theoretical gain from shorting is 100%. A stock can only go to zero. If only 10% of your shorts are wildly correct and go to zero, you just made 1

> The maximum theoretical gain from shorting is 100%. A stock can only go to zero. If only 10% of your shorts are wildly correct and go to zero, you just made 10% on that one bet. That's one way to look at it. A stock can only go down 100%. But shorting can make tons of money because: a) stairs up, elevator down, it takes shorter amount of time to get the same price movement. b) leverage, corollary of (a). c) A stock going from 400 to 200 is a 50% move, from 200 to 400 is a 100% move, in terms of points its exactly the same so you earn the same amount.