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How to Make Money in a Down Market

 
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shanikasparrow
Ninja Dog
Ninja Dog


Joined: 09 Nov 2017
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Location: Minsk


PostPosted: Thu Nov 09, 2017 5:00 am    Post subject: How to Make Money in a Down Market Reply with quote

Short selling is a technique that many stock brokerages allow. It allows you to Sell High then Buy Low, which is the opposite order of the traditional Buy Low, Sell High technique. First, you will need to apply for a margin account with your trading brokerage. Having margin gives you the ability to buy more stock than the cash you have available by borrowing money from your brokerage. This is also called leverage because it allows you to do more with the money you have. All brokerages require a margin account to do short selling.

Second, Compare The Tipster Review you need to find a stock that you believe will be dropping in price soon. However, not all stocks are available for shorting due to supply limitations or other restrictions. When you go to short sell this company, your brokerage will let you know if it is available to short on their system. The brokerage needs to have those shares available to lend to you before you can sell them.
This concept may sound strange, but after you read more about it and try it on your own it will start to make sense. It is used successfully every day by thousands of traders. It is somewhat controversial, however. In fact, the SEC considered banning it for a while. But after they made better regulations on it, they decided to continue allowing it because it is a healthy part of the market. When prices are dropping, who is going to buy the shares from people needing to get rid of them? Short sellers, along with traders looking for bargain prices.
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