ABSTRACT

This chapter describes directed largely to the new trader, to the investor who has followed other analytical methods, and to the investor type who is for the first time, taking up the technical trading of stocks for the shorter term. It explores two touchy questions: is the use of margin and is that of short sales. In fact, short selling is limited, very largely, to skilled professionals. A commitment in commodity futures contracts, whether long or short, although quite different in theory, has some similarities to a short sale of stock. A short sale of stock must always and necessarily be a margin transaction. A majority of traders avoid the short side of the market. Six out of seven investors’ people meet, who have bought or sold stocks, will tell people they would never sell a stock short under any conditions, at any time.