Short Trading
It is a position that you take when you are selling an asset as you expect the price to go down, with the intention of buying it again at a lower price. It is mainly used in margin trading but largely across derivatives markets.
Traders open a short position in the hope that the price will go down in the future. E.g. If a trader, trading in the XRP/BTC pair, shorts 1000 XRP at 4x leverage. If the BTC equivalent of 1000 XRP is 0.09 BTC (considering XRP/BTC is at 0.00009000), then the exchange lends the trader 1000 XRP against a collateral of 0.0225 BTC. The trader owes the 1000 XRP to the exchange and can return this obligation at a later time, by buying it at a lower price.
Traders open a short position in the hope that the price will go down in the future. E.g. If a trader, trading in the XRP/BTC pair, shorts 1000 XRP at 4x leverage. If the BTC equivalent of 1000 XRP is 0.09 BTC (considering XRP/BTC is at 0.00009000), then the exchange lends the trader 1000 XRP against a collateral of 0.0225 BTC. The trader owes the 1000 XRP to the exchange and can return this obligation at a later time, by buying it at a lower price.
What is Trading?
What is investing?
Fundamental Analysis
Technical Analysis
Market trend
Candlestick charts
Long Trading
Short Trading
What is margin trading?
What are derivatives?
What are forward and futures contracts?
What are perpetual futures contracts?
What are Inverse Futures?
What are Vanilla Futures?
What are options contracts?
What is investing?
Fundamental Analysis
Technical Analysis
Market trend
Candlestick charts
Long Trading
Short Trading
What is margin trading?
What are derivatives?
What are forward and futures contracts?
What are perpetual futures contracts?
What are Inverse Futures?
What are Vanilla Futures?
What are options contracts?
