Trader Long or Short:
In trading, the two fundamental strategies are going long (buying) and going short (selling initially).
Going Long (Buying):
* Goal: Profit from an increase in the price of an asset.
* Premise: You believe the price will go up.
* Mechanism: You buy the asset and sell it later at a higher price.
Going Short (Selling Initially):
* Goal: Profit from a decrease in the price of an asset.
* Premise: You believe the price will go down.
* Mechanism: You borrow the asset, sell it, and buy it back later at a lower price to return it.
Choosing a Strategy:
The decision depends on your analysis (technical and fundamental), market conditions, and your risk tolerance. Short selling is generally considered riskier.
Conclusion:
Going long and going short are two essential ways to participate in the markets. Understanding both is key for a versatile trader.
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