What is a long and a short stock?

Here’s the long and the short of it! The distinction between going long and going short is brief but important: Being long a stock means that you own it and will profit if the stock rises. Being short a stock means that you have a negative position in the stock and will profit if the stock falls.

What is the difference between a long and a short stock position?

A simple long stock position reflects a bullish outlook. The buyer anticipates that the stock will rise in price. A short stock position is bearish in that the seller believes the price will decline. It is important to remember that short positions come with higher risks than long positions. They may be limited in IRAs and other cash accounts.

What is the difference between a long and a short position?

Going long generally means buying shares in a company with the expectation that they will rise in value and can be sold for a profit (buy low, sell high). With options, a long position constitutes being the buyer in a trade. For example, if you buy a call option, you'll be long that option. What Is an Example of a Short Position?