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Regarding stock investments ... the difference between long and short? |
Regarding stock investments ... the difference between long and short? Going long a stock is when you buy it in expectation that it will go up in price. You are bullish. zackly right. The problem with selling short is that theoretically your risk of loss is unlimited. Say you sell Amgen short at $56. If it goes down to 50, you made 6 per share. However, if they announce the cure for all cancers, diabetes and world hunger and it goes up to 500, you owe your broker $444 per share. Rather than selling short, consider selling a put option. Long means you make money when the stock goes up from $1.00 to $2.00 |
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