An investor who assumes that the value of stock which he owns is going to fall in future can sell that particular stock. But is there any chance of selling it and making profits even if he doesn’t own that particular stock? The answer for the latter situation is "Short-selling".
Short selling is a situation where the investors at first sell the stock and later buy it at the end of the day to square of the position. It is usually done when one feels that the value of the stock is going to fall.
The sky is the limit on short-selling. Short-sellers' risk is unlimited since the upside potential of share prices is, theoretically, unlimited.
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