Short selling

Short selling flips the usual sequence: you borrow shares, sell them now, and hope to buy them back later at a lower price to return to the lender. Your profit is the drop; your loss is the rise.

Shorting has theoretically unlimited loss potential because a price can rise without a fixed ceiling, while a long stock’s loss is capped at the purchase price going to zero. It also involves borrow fees and short-selling rules. Beginners usually study shorts conceptually long before trying them with real capital.