Shorting Stocks — Friends and Relatives Edition

One complaint that I’ve received is that my blog is a little complicated and jargony for readers not involved in the finance field.

One thing I find myself explaining to those unfamiliar with trading is the concept of short selling.  The uninitiated think of short selling as either a loophole in financial markets that will allow you to make unlimited amounts of money or something that is categorically reprehensible and worthy of some soul searching.  Salmon Khan’s Khan Academy is pretty much the undisputed heavyweight champion of explaining boring, dry, or frustrating material in a calm, clear, and concise manner.  So I’ll leave it to him.  The first two videos explain the mechanics of shorting stocks and the third touches on the importance of short sellers and their place in the market.

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