When trading a pair, let's say Active1/Active2, if you Short for Active1, at the same time you go Long for Active 2.
If you sold your BTC for ETH, you've shorted BTC and at the same time you become an investor in ETH...
Topic: What does "shorting" really mean? (Read 569 times)
Should I farther confuse you?
When trading a pair, let's say Active1/Active2, if you Short for Active1, at the same time you go Long for Active 2.
If you sold your BTC for ETH, you've shorted BTC and at the same time you become an investor in ETH...
When trading a pair, let's say Active1/Active2, if you Short for Active1, at the same time you go Long for Active 2.
If you sold your BTC for ETH, you've shorted BTC and at the same time you become an investor in ETH...
SHORTING is the process of trading thru lending from your Crypto Currency site. ("MARGIN TRADING").
For example, the pair: BTC-USD
If Bitcoin price is going up.. Then you "LONG" or "BUY"
If Bitcoin price is going down.. You select "SHORT" or "SELL"
When bitcoin price goes to the opposite direction of your chosen position. Then you got a -NEGATIVE profit. Be wise from choosing your LONG or SHORT position.. It can liquidate your whole Bitcoin investment..
And as an advice, if you are a beginner stay away from this Margin trading, as many newbies lose a lot of money from this kind of trading, count me in.
Just trade a normal trade from Poloniex.
For example, the pair: BTC-USD
If Bitcoin price is going up.. Then you "LONG" or "BUY"
If Bitcoin price is going down.. You select "SHORT" or "SELL"
When bitcoin price goes to the opposite direction of your chosen position. Then you got a -NEGATIVE profit. Be wise from choosing your LONG or SHORT position.. It can liquidate your whole Bitcoin investment..
And as an advice, if you are a beginner stay away from this Margin trading, as many newbies lose a lot of money from this kind of trading, count me in.
Just trade a normal trade from Poloniex.
There is another terminology in trading industry "long". But traders never concern about it, that may be the reason the shorting seems too strange for most of the people.
In my understanding, shorting is another type of trading mechanism but it deals with downfall market. More importantly I believe it does not concern anything with leveraging/margin trading. Because shorting will be possible with all your capital but against broker and not in the peer to peer environment.
In my understanding, shorting is another type of trading mechanism but it deals with downfall market. More importantly I believe it does not concern anything with leveraging/margin trading. Because shorting will be possible with all your capital but against broker and not in the peer to peer environment.
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Does the term "short" imply that you are leveraging/margin trading? Or can short mean simply selling, waiting then re-buying cheaper?
I think it depends on the market!Up for me, I think that leveraging/margin trading is an extra layer of complexity and not the necessary part of the trading process.
If market allows selling now and buying later without lending money - you can still say you've shorted.
Like in crypto, I might sell my bitcoins today (let's say for 1200$/btc) - I've shorted my bitcoins. Now I will wait, wait, wait, and who knows, maybe someday the price of bitcoin will be 500$. I will buy the same amount of bitcoins that I've sold today and the remaining $$$ will be my profit.
Who will tell me that isn't correct, and for me to really short in classical terms, I should lend 10x bitcoins to what I currently have and sell all of them?
There is no way to do "short" positions on any market without margin trading, because your broker needs to lend you money.
Also, margin trading usually means that your trades are also leveraged (in most of cases).
When you go short, you basically lend the money and you give them back in the moment of closing the position.
The difference between entry price and exit price is obviously a profit/loss.
That is why I really love poloniex, because I am able to do margin trading ( so I can go long/short) and most importantly, I do not have to give up my sensitive data, like identity or place of birth.
It is a bit laggy for me sometimes, but still it is the best tool for me to trade different ( but rather legit ) altcoins, and also the volume is really big.
Also, margin trading usually means that your trades are also leveraged (in most of cases).
When you go short, you basically lend the money and you give them back in the moment of closing the position.
The difference between entry price and exit price is obviously a profit/loss.
That is why I really love poloniex, because I am able to do margin trading ( so I can go long/short) and most importantly, I do not have to give up my sensitive data, like identity or place of birth.
It is a bit laggy for me sometimes, but still it is the best tool for me to trade different ( but rather legit ) altcoins, and also the volume is really big.
Does the term "short" imply that you are leveraging/margin trading? Or can short mean simply selling, waiting then re-buying cheaper?
I have always been confused about it.
I have always been confused about it.
Yes it implies margin trading. You cannot short by just selling, because it's a sophisticated process done by the broker consisting of borrowing, selling and repurchasing.
Does the term "short" imply that you are leveraging/margin trading? Or can short mean simply selling, waiting then re-buying cheaper?
I have always been confused about it.
I have always been confused about it.
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