Hello everyone. I would like to suggest the introduction of stock shorting in the torn stock market. To give you a glimpse of it, let's take a look at this example:
DAY 1
STOCK A Current trading price: 100$
Investor SHORTS/LOANS 1 share and sells it at a 100$
Day 2
Stock A Current trading price: 50$
The investor REPURCHASES the stock at 50$ and returns the share to the owner.
Profit: 50$ (100$-50$)
As you can see, stock shorting is loaning shares from someone who owns a share/shares of a company and is willing to let other people borrow it in return for interest. Now, from the perspective of the one who loans the share, he/she loans the stock and sells it at a higher price ( or current trading price) and is expecting it to go lower in order to repurchase the stock back again at a much lower price and return it to the rightful owner.
Benefits of Shorting:
Injects liquidity in the market (granted that demand is considered)
Minimizes Stock Monopoly
Adds volatility to the market
Owner/Loaner Benefits of the Interests
Loanee gets to benefit from the "Downs" of the market
TLDR; Shorting benefits everyone (especially ppl with high-risk appetite) in the stock market
DAY 1
STOCK A Current trading price: 100$
Investor SHORTS/LOANS 1 share and sells it at a 100$
Day 2
Stock A Current trading price: 50$
The investor REPURCHASES the stock at 50$ and returns the share to the owner.
Profit: 50$ (100$-50$)
As you can see, stock shorting is loaning shares from someone who owns a share/shares of a company and is willing to let other people borrow it in return for interest. Now, from the perspective of the one who loans the share, he/she loans the stock and sells it at a higher price ( or current trading price) and is expecting it to go lower in order to repurchase the stock back again at a much lower price and return it to the rightful owner.
Benefits of Shorting:
Injects liquidity in the market (granted that demand is considered)
Minimizes Stock Monopoly
Adds volatility to the market
Owner/Loaner Benefits of the Interests
Loanee gets to benefit from the "Downs" of the market
TLDR; Shorting benefits everyone (especially ppl with high-risk appetite) in the stock market