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Shortselling in Financial Markets: Speculators Lose Billions on Tesla and Nvidia Shares

You can make money in the financial markets in different ways. Cautious people try to pick stocks of good, growing companies with the idea that in five or ten years they will be able to sell for a decent amount. On the other hand, risk-lovers tend to speculate, hoping for short-term price fluctuations – buy this morning, sell in the evening.

Some are hoping for a fall in the value of the company’s shares. Analysts’ calculations show that last year in the US market, speculators lost almost 200 billion, hoping that the value of the shares of companies such as “Tesla”, “Nvidia” will fall.

Some are hoping for a fall in the value of the company’s shares. Analysts’ calculations show that last year in the US market, speculators lost almost 200 billion, hoping that the value of the shares of companies such as “Tesla”, “Nvidia” will fall.

“Shortselling” of shares (shortselling – English) is an activity allowed in the financial markets, when a speculator, anticipating that the value of a company will soon decrease, borrows shares of this company, sells them at the current market price, but at the moment when the prediction of a price drop comes true , takes the opportunity to buy the borrowed amount of shares at a much lower price. Accordingly, he keeps the difference.

At the beginning of this year, the analytical company “S3 Partners” published data that speculators who hoped that the value of Elon Musk’s electric car company “Tesla” would decrease lost more than 12.2 billion US dollars.

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2024-01-11 19:00:02
#hurt.. #Speculators #lost #billions #hoping #Tesla

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