what is difference between normal selling and short selling of shares?

Answer 1

Normal selling involves shares you own; short selling is selling shares you borrowed. Normal selling involves selling shares that you had hoped gone up in price; short selling you had hoped the price goes down. Normal selling is done after you buy; short selling is done first before you buy. In simple terms shorting is betting the stock goes down.

Answer 2

The answers so far are clear in that you are selling stock you do not own. The mechanics invovolve the brokerage firm executing the trade actually booking a loan of stock for you to sell. They tap into their customer base or brokerage network to find the shares you want to sell/borrow. They book a stock loan to you on their books, then you get the cash for the transaction into you account. Later you will buy the stock, hopefully lower than you sold, to replace the shares you have originally borrowed. The behind the scenes transactions have been in the news more recently as some short selling hedge funds have found ways to short stock "naked" meaning they have not actually borrowed stock to sell. This is not legal, but reports are that certain priveledged hedge funds have found brokers that will do it for them. Also, recent trading rules have changed for shorting. Previously, you could only execute a short sale on an uptick in the price of the stock,meaning a trade at a price higher than the previous trade which was executed. This was originally put in place to prevent mass selling pressure from shorts after the crash in 1929. The repeal of this rule makes it much easier to short especially for stocks which do not trade in high volume. Shorting can be quite profitable and always very dangerous as you loss is potentially unlimted. If you buy a stock you can only loose what you invested. When shorting, the stock can theoretically go up forever, thus your potential loss is infinite. Shorting is generally best used as a hedge against your other investments.

Answer 3

Short selling means you sell the shares which you don't have and later cover your position by buying them.It's done to make profit by short selling at a higher price and then buying at a lower price.While trying to do so,one may loose money also if he has to buy the shares at a price higher than at what he sold.Practice is resorted to in day trading.

Answer 4

u have the shares and then sell is the normal selling.

u dont have the shares but u sell the shares and ur forced to buy at level to square the position. this is short sell

Answer 5

In normal you sell your shares.
In short you sell somebody else's shares (Usually the bank's) and they expect you to buy them back in the future and return them (It's a loan)

Answer 6

when you "short-sell" you are taking out a loan in the hopes that the stock will go down, and you make money on the amount of value the stock loses. It is a somewhat controversial practice.

Answer 7

With a wifi router you can access the internet anywhere in your house and with a normal router you'd have plug the wire and sit in one position (which sucks). With wifi you can have all the computers you have connect to wifi. While the router gives limitations on how many cables you can connect too at one time.