Type of Account needed for short selling trades

[KP06]

Hi,

I'm wondering if anyone has any advise on what type of account i would need to open to execute both Long and Short share trades?

I've seen CFD accounts, but dont want to utilise a margin, just want to use my own money but to be able to make short share trades as well as long share trades.

Any help would be great for a newbie just starting out

 

[kahuna1]

No idea ... sorry.

Maybe a TAB account is more fun and will cost A LOT less ?



BY your question and being a newbie ... or learning which is a good thing ... No offense meant, I am still learning many moons and decades latter.

Shorting shares ... is actually MARGIN whatever you may think. Your granting unlimited upside ... so you think a share goes down. It invents cold fusion and the 10 cent share goes on hold whilst announcement made comes back at $1,000- or $1- million. Less dramatic say a miming company discovers a massive deposit and your bet ... hoping you loose only say 10% on 50k, turns out to be 2000% or a total loss of 100k v an expected 5 k loss.

Not a fan of shorts, even with many years experience , not in the case of specific risk ... that being over a single share .... often your betting against stupidity and whilst a company may come out with shocking news, and your right, in the meantime it can rally 100% and your wiped out when say 2 years latter its worth 2 cents verses the 50 cents starting point.

Non specific risk or market risk even at times is not for the less experienced people. At times one blinks and its up or down a few percent .... even 5% or say 9/11 ... 15% ..

good luck

 

[Johny5]

I've seen CFD accounts, but dont want to utilise a margin, just want to use my own money but to be able to make short share trades as well as long share trades.

I sometimes use options when I want to short a share (I seldom do though) but I cant see a way that you would avoid margin calls. Options can be very risky especially when you write them, risk can be minimised by using spreads etc, also lowers the margin calls. But options have lost their popularity in recent years so are quite thinly traded nowadays, often its just you and the market maker (no depth) also only a limited number of shares are offered as options. But the big question is can you make money from them, well sort of the trouble is the bid ask spread is often quite large so its hard to buy or sell the option at a price that will be profitable, thin trading also makes it hard to make a good profit. I mainly trade equities and just use options as insurance or to help repair a bad trade that I believe will come good in the long run.