RE:Do shorts need money roIt's a collateral credit, I think... basically, they borrow shares from brokers, sell them, wait for the market to go down, buy them back at a lower price, and pocket the difference.
The problem with shorting though - if the shares go up in value, they still have to buy them back, and potentially at costs that exceed what they have available - and the borrow rates are pretty extreme. Some overnight carries are at 100% of the stock price.
Some call it brave, but it's actually pretty stupid - there's only so much you can potentially gain, but you can potentially lose a nearly infinite amount of money if the stock makes a sudden surge from, say 80¢ to $200.
Axe5555 wrote: Borrow shares or can they actually pull
this sh$t off on credit if it goes their way ?