Markets go up – markets go down. Everyone knows that. What people don't know, however, is that money is made in both directions. One of the biggest public misconceptions is that if the markets are going down, then everyone in the market is losing money.

This couldn't be further from the truth. Short-selling allows market participants to make money – just as much of it – while it's going down as well.

"Oh but shorting is immoral, and wrong "​

I've been hearing this a lot from some of the community members and Mango Readers as well. I was a bit intrigued by this notion – so I asked a few questions on why they have this idea. After a few conversations, I've come to realise that many people seem to misunderstand what Short-Selling really is.

"Most people seem to misunderstand what short-selling is"

Short-selling actually serves a crucial role in the market. And whether you believe it's immoral or not, it will really benefit you to understand how it works. Understanding Short-Selling will allow you to:

Get out of investments/trades at the right time

of investments/trades at the right time Get into good trades at the right time

good trades at the right time Sell for profits at opportunistic times.

​



And you don't need to be a short-seller to take advantage of these things. All you need is to understand how short selling works. In this guide, I'll explain short selling – as I usually do – using a simple analogy and story.