I have never sold short again, nor will I.
What does 'sold short' mean?
Rick, there are 2 types of short selling:
1) short selling shared in which you already have an interest in. For example: you have in your portfolio a stock for for some reason or another you cannot sell it. You take an opposite position by short selling in order to hedge your risk.
2) naked short selling in which you have no interest in the said stock by you short sell it anyway. This is for speculative reasons and there is quite a bit of money to be made if you do it right since you can leverage your money quite a bit.
Back when I was doing a little trading in college, there used to be a rule that you can only cover your position when you short sell on an "up-tick" in the price... That was a rule implemented to avoid abuse but it has since been taken out of the rule books.
However, be careful when you short sell... if you bet wrong and you get that margin call... you'll get screwed big time.
