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Economy
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Shares
The capital of a company is divided into shares. Each share forms a unit of ownership and is offered for sale so as to raise capital for the company.
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Sir Arthur Lewis
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Definition: In capital markets, the act of selling a security at a given price without possessing it and purchasing it later at a lower price is known as shorting. This is also termed as short selling.
Description: Shorting is largely done with the motive of earning profits by purchasing the securities at a lower price later on. Once shorting is done, the purchase of the same securities in order to book profit/loss is known as short covering.
Example: If a trader purchases 100 shares of X Ltd at Rs 100 each and later on the price of each share falls to Rs 80, then the trader can book profits by short covering them. By short covering at Rs80 each, the trader would be able to earn profit of 20x100= Rs 2000.
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- SECURITIESCAPITAL MARKETSSHORTING
- PREV DEFINITION
Shares
The capital of a company is divided into shares. Each share forms a unit of ownership and is offered for sale so as to raise capital for the company.
Read More
- NEXT DEFINITION
Sir Arthur Lewis
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- Time to buy Titan and short Reliance, says Rahul SharmaRahul Sharma, Director at JM Financial Services, recommends a long position in Titan, as he sees some technical reversal on its daily charts, and expects a good round of up move. Conversely, Sharma recommends shorting Reliance Industries at its current price as its short-term and long-term moving averages suggest a bearish bias.
- For traders, Axis Bank can give a 5-6% bounce back; time to short Ashok Leyland: Rahul Sharma“We should be more optimistic than pessimistic at 17,500. The risk rewards are more favourable for fresh long addition at these levels and one can expect a bounce back of a minimum 300 to 400 points from the 17,500 trajectory. We believe that only if 17,450 is broken on a closing basis, it will call for any further shorts or further weakness into the broader market. ”
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- Value emerging at lower levels in some pockets of this marketThe Nifty50 has broken the long-term trend line this week which was valid since last one year.
- Value emerging at lower levels in some pockets of this marketThe Nifty50 has broken the long-term trend line this week which was valid since last one year.
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