Net Short

Net Short can be defined as a situation where the investor experiences more short positions as compared to the number of long positions in a given asset, market, economy or any other monetary situation. The net short can also be experienced by the investor in the case of portfolio of the investor or during the trading of various stocks or securities. The investors that are net short or experiencing the situation will gain benefit from the situation when the price of the underlying asset decreases.

In a number of cases some advance and clever traders attribute large proportion of their assets or property to net short as compared to assigning it to the net long. Such a portfolio in which the major portion of the investor asset is net short will increase as the price of the underlying assets or securities decreases. The reason behind this logic is that investors in the market borrowing the securities from the broker and selling them in the market with a hope that they will buy back these securities at some low rate afterwards. This type of position is taken by the investors having strong background in terms of experience and funds. Net short position can also be taken by the traders on the currency as well.  However the net short position on the currency is only taken by the non-commercial investors

Other Related Accounting Articles:

• Underlying Asset
• Market Segmentation Theory
• Offering Price
• Underwriter
• Assets under Management
• Future Contract
• Write Up
• Bid Wanted
• Maintenance Margin
• Mean Variance Analysis