Hi i think it will be great if we had the option to sell short in the invest account,I feel it’s missing and it’s a basic thing to have.
shorting is trading, not investing behaviour and has no place in “invest”.
it doesn’t even make sense as you cannot invest in something you do not own.
actually i think you are wrong.in this time and overall shorting a stock is an investment for anything, and its popular in every broker.
the basis of investing is to put money into something you believe will do well.
tell me how shorting fits into that and where I am wrong with understanding investing?
you will need to be specific.
Investing is also shorting a stock,you invest on the stock price to go down and a lot of pepole do a long time short.Thats in if the basics in investing.
i think the word you are looking for is “you speculate on the price going down” or “you gamble on the price going down”.
I will need a specific example, not a generalisation that lacks detail.
Right now you can short the S&P500 and DAX by buying inverse ETFs, but that’s about it
PS. You can still use your CFD account to short there. Why not do that?
as you say “speculate the price to go down” or “gambling the price to go down” you can say the same on when “you speculate the price to go up” or “gambling the price to up” you can never know what will happen and therefore you can call anything a gamble.for advance investing it is required to have short selling because this is an investment for anything. in both long and short you can be a “gambler” and reckless and lose money,they act the same and implement each other.
For people wanting to spread out or hedge the market, shorting is essential.
Say your investing and your view over the year is bullish. You would want to buy into cyclical stocks and short defensive stocks, thereby hedging your positions. Normally it allows a portfolio to limit downside risk and slightly reduce upside gains.
It has it’s place I think. Not essential, but offers a nicer way to balance a portfolio.
For many on here though, it’s not needed. Like, it’s not a deal breaker for me in any which way.
You can always open short positions in the CFD account though? Just choose a conservative trade size and you won’t even risk more money than you would with regular short selling. (Aside from the swap of course)
The difference with “gambling the price will go up” is that in the meantime you actually own something, you hold a part of the company under your name and share a stake in its success or failure. It’s not being borrowed from someone else. when dividends are paid, its from the company to you as an owner. if you believe a company is going to do badly there is already a way to short sell, and to do so with much greater ranges of profit in the CFD account. of course take note that most people lose money. holding a share is also more than just speculating the price will go up. it is “I want to own this company” even if it trades sideways, its a voice at the table.
I was waiting for an example, you are just generalising my use of “speculative” and “gambling”.
In general terms short selling is an advanced strategy, period, however when you look this strategy up people make liberal use of investor and trader in the same sentence, but the typical investor is not a trader. to invest in something is to put forward collateral in the aim of making it grow. a short sell is made with the intent of taking from the failure of another. it’s an advanced strategy used by professionals, why do you believe retail clients would want such an element of risk added to an already risky market? when I buy a share I can walk away from it for as long as I want, so long as the company doesn’t go bust I hold that share, can you do this when shorting? sell a share that isn’t yours and never give it back to the person you borrowed it from?
I am not saying that advanced features don’t have their place, but T212 has already said before they are looking into further account types. why must “invest” specifically get this feature? the Invest set-up in its current form is about holding positions of value. you add in short selling and now there have to be additional mechanisms that take the decisions away from you just to protect your account from going below zero, which is basically what the CFD trading account already does.
My stance on this is based on “Ownership”, you don’t own anything in a short sell. but as “invest” is now, you own everything on your terms. investors lose only when they choose to sell, traders losses are determined for them the instant they cannot afford to close their position.
@adm gives real examples for their case. and @CaptainDangernoodle rightly mentions you can already do this indirectly through inverse ETFs or through the CFD account.
of course there are things that are trading tools in nature such as the stop-loss already present. its a horrific tool that doesn’t add anything to the investors toolkit, but its already an industry norm that all investors and traders alike are familiar with so it is there. short selling isn’t so core or widespread, its “advanced” and done by just a few.
I don’t think they are planning to offer that. Not sure you can do it on CFDs either…
It would be good to have to hedge risk. I doing do cfds.
T212 needs to play catch up I feel to other brokers.
+1 for short selling, critical feature.
You need a margin account to short stocks as you are effectively borrowing from the broker. That’s what the CFD account is for.