Thread: Short Sell

It sound ridiculous that after posting 32 posts in the forum you're askin this simple ques..

anyway..

"When an investor goes long on an investment, it means he has bought a stock believing its price will rise in the future. Conversely, when an investor goes short, he is selling a stock (ofcourse he's not holding the same) anticipating a decrease in share price.
Its just like you are short of money in a casino but are sure that you would win the next game and you lend some money from your friend to play and return the same after the game (you have to).
The only difference is that in stocks you have to return the stock back that has been sold without holding it and thats too before the market close (there are some cases in which you can't buy back, any guessess.)
However in derivatives trading you have the time buy back until its expiry...

Confused? Ok simple when you short sell a stock, your broker will lend it to you. The stock will come from the brokerage's own inventory, from another one of the firm's customers, or from another brokerage firm. The shares are sold and the proceeds are credited to your account. You must "close" the short by buying back the same number of shares (called covering) and returning them to your broker. If the price drops, you can buy back the stock at the lower price and make a profit on the difference. If the price of the stock rises, you have to buy it back at the higher price, and you lose money
"

Sorry To Ask You This Question But I Do Not Know Basic Of Share Market . I M A Medical Student Not Able To Give Proper Time To Market.:-(

Ok , my mistake, I thght u to be pro as u've been to this forum for many months.... anyways good luck 4 ur studies and dont bother bout markets. If u dont have time then u better stay away.... u'll definitely come out as winner....
afterall a zero always greater than -1

bye

THANK YOU . WHENEVER MY BROKER SUGGEST ANY STOCK I ASK YOU PEOPLE AND THEN ACCORDING TO YOUR ADVISE I BUY IT OTHERWISE NO is this method correct
? i also have one more query what is stop loss doer it mean i should sell stock if it reach that level

In short ... No, apply ur own mind and if u cant analyse then u shouldnt be in the markets

Stop loss Order: An order placed with a broker to sell a security when it reaches a certain price. It is just to limit an investor's loss on a security position.

A simple example... u bought 10 shares of RIL @ 2400 and expected to reach 2450 the same day but instead of rising it started falling down 2390.... 2380.... 2370.... and more.... what to do in this situation would u book the loss at 2360 or hold the stock for some more days. A smart trader would keep a stop loss of Rs 15 in his mind (Ofcourse he knows that if the stock fell beyond Rs 15 it could fell further down)

So when the trader buy 10 RIL @ 2400 at the same time he puts a stop loss order of to sell all the 10 shares @ 2385. It means if the stock start falling and reaches 2385 mark all the shares will be sold @ market price. Whats the benefit of doing that... he can now buy the same stock @ 2370 again.

Now if the stock start rising then again u can use this stretegy... like if the stock rises to 2430 and you are unsure that whether it will rise or fall, u can place or modify ur earlier stop loss order to 2425 ... so that it should be sold automatically if tries to fall beyond that point....
Its just a like a boundry line u have placed because u want to limit ur losses upto a certain extent....

Same is the case with stop loss buy order... if the share at Rs 100 is rising to 101, 102 .... and u know that if it crosses 103 it will zoom to 106, 107 and u want grab it at any cost put a stop loss buy order at 103.... if it remains below 103 or further fall below then no harm as u wont get the shares and u r safe. and if it reaches 103 and u got the shares and it reaches 105,106 u r in profit...

But u have to be determined about support and resistence levels of the shares in both cases

Bye

hey can u tell me how gap up or gap down occurs during opening in markets

Please note that the following definitions applies to all markets and not limited to Indian markets only

If the market opens at a different price than it closed the previous day, the market has experienced an opening gap. This price pattern is called a gap because on a trading chart there will be a gap (blank space) between the closing and opening prices.
Opening gaps can be caused by news releases or other events that happen while the market is closed, or by traders deciding what prices they will trade at, and placing their orders, before the market opens.

There are several different types of opening gap, with the most common being the following :

Full Gap Up
A full gap up occurs when the market opens at a price that is higher than the previous day's high. For example, if the previous day's high was 5000, and the market opened at 5050, there would have been a 50 point full gap up.

Full Gap Down
A full gap down occurs when the market opens at a price that is lower than the previous day's low. For example, if the previous day's low was 5150, and the market opened at 5010, there would have been a 140 point full gap down.

Partial Gap Up
A partial gap up occurs when the market opens at a price that is higher than the previous day's close, but lower than the previous day's high. For example, if the previous day's close was 4500, and the previous day's high was 5000, and the market opened at 4560, there would have been a 60 point partial gap up.

Partial Gap Down
A partial gap down occurs when the market opens at a price that is lower than the previous day's close, but higher than the previous day's low. For example, if the previous day's close was 3650, and the previous day's low was 3400, and the market opened at 3630, there would have been a 20 point partial gap down.


Bye...

Thank You , How Does A Company Goes In Upper And Lower Circuit And Can A Single Buyer Or Seller Can Break Circuit ?

Upper Circuit ==> No seller, only buyer
Lower Circuit ==> No buyer, only seller

Circuit cannot be broken..