Comment on Commonly Used Jargons

Suraj Giri commented on 09 Apr 2017, 12:52 AM

An obvious question you may have – How can one sell Wipro shares without owning it. Well you can do so, just like the way I sold a phone that I did not own.

When you first sell, you are essentially borrowing it from someone else in the market, and when you buy it back, you actually return the shares back. All this happens in the backend, and the stock exchange facilitates the process of borrowing, and returning it back.

In fact when you short a stock, it works so seamlessly that you will not even realize that you are borrowing it from someone else. From your perspective, all you need to know is that when you are bearish on the stock, you can short the stock, and the exchange takes care of borrowing the stock on your behalf. When you buy the stocks back, the exchange will ensure the stocks are returned back.,…….—-
I when I first sell how I am borrowing it from someone else….
And then when I buy it back how I am returning it.
Very hard to understand this part.
And same question again how can I sell something which I am not owning

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