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by lottin 1401 days ago
Google short selling.
2 comments

thanks, I work at a financial institution, so I "Googled" it a few times, short selling is based on borrowing the underlying securities - not owning them - or alternatively owning a(n often bespoke) derivative, related to those securities, which behaves as a short.

If you own a security you are long, not short.

If you hold eth, you are long eth.
Not really, you can be long in one market, and short in the derivatives market, and your net position be short. You'd be holding eth, but you'd be short.
not really, in that case you have two separate positions, one long and one short.
If you make money when the price goes down then your overall position is short.

The point is that it can be profitable to crash the price even though you're holding the asset at the same time.

> it can be profitable to crash the price even though you're holding the asset at the same time.

in that case, the less you hold the more profitable it is. I'm not sure I get your point...

The point is that your assumption

> If you own a large amount of a currency, you want to ensure that the currency in question is trusted, or otherwise that currency would end up losing its value.

is fundamentally flawed. You can own a large amount of a currency and profit from it losing its value.