Green Cures and Botanical Distribution Inc (GRCU)

[ilenes]

Hi Motba,

Shorting is playing the other side of the house...betting on the stock price going down, as opposed to going up.

The way that happens is that you "borrow" shares and sell those borrowed shares, pocketing your sales proceeds, just like if you had a stock that you decided to sell...your profits are yours at the time you sell. However, since you didn't own the stock you sold, you eventually need to cover.

Hence the "short squeeze".

Whereas going long caps your losses (you can't lose more than what you invested) and gives you unlimited gains, going short is the opposite. You know upfront that your maximum gain is (sell at $2, cover at $.00, for example) however, your losses are unlimited.

I know this is very basic, but I hope this helps!

Ilene