Comment on Tesla’s in its flop era
magic_lobster_party@kbin.run 5 months agoAlways remember: when you invest in a stock, you can only lose what you’re putting in. When you short a stock, there’s no limit in how much you can lose. Yes, that means you can go in debt.
1984@lemmy.today 5 months ago
Well you lose the amount you shorted. You can’t go into debt for money you don’t have.
magic_lobster_party@kbin.run 5 months ago
Shorting is when you borrow stocks and then immediately sell it. At some point you have to buy those stocks back so you can return the stocks to the lender.
Say you short 1 stock at $1000. The stock later drops to $100. You have made a good $900 profit when you return the stock.
Say the stock instead goes to $10,000. You have made a devastating $9000 loss. You have lost more than you initially shorted.
1984@lemmy.today 5 months ago
Yes I know but I meant that you don’t have to do any of that yourself. You buy a bear or a mini and it’s taken care of automatically.