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Although this may add to the confusion, think of shorts as selling
first and buying later.
So if you Sell first at $10/Share and Buy later at $6/Share you made
$4/Share i.e. you are wanting the price of the shares to go DOWN and
like other trades %G/L = 100 * (Selling Price - Buying Price) / ENTRY
Price which in the case of short side trades is the selling price
i.e. 100 * (10 - 6) / 10 = 40%
--- In amibroker@xxxxxxxxxxxxxxx, "amiabilityy" <amiabilityy@xxxx>
wrote:
> hi chuck, this has confused me a little,
>
> i understand how to work out longs with commisions e.t.c.,
>
> but shorts confuse me as i have never used them.
>
> Is it basically the same as a losing trade when going long.
>
> e.g. i buy a stock at $1000 it goes to $500, i have lost %50.(on a
> long trade), but if this was a short trade i made %50.
>
>
> Peter.
>
>
> --- In amibroker@xxxxxxxxxxxxxxx, "Chuck Rademacher"
> <chuck_rademacher@x> wrote:
> > You should be able to do it with one formula. I'm not much of a
> spreadsheet
> > programmer, but offer the following tid-bits for you:
> >
> > Column1 = Dollars invested ($1,000 in each example, long or
short);
> >
> > Column2 = Dollars profit, simply what you sell it for (sell or
> short)
> > minus what you paid (buy or cover).
> >
> > Column3 = Percent profit (column2 / Column1 * 100).
> >
> > -----Original Message-----
> > From: amiabilityy [mailto:amiabilityy@x...]
> > Sent: Wednesday, April 30, 2003 4:05 PM
> > To: amibroker@xxxxxxxxxxxxxxx
> > Subject: [amibroker] Re: how is the profit for shorts
calculated?
> >
> >
> > Thanks chuck, this will make it harder to calculate in a
spread
> > sheet.
> >
> > I was hoping to just reverse the short and cover columns and
use a
> > long profit calculation.
> >
> > Peter.
> >
> > --- In amibroker@xxxxxxxxxxxxxxx, "Chuck Rademacher"
> > <chuck_rademacher@x> wrote:
> > > I wish you were correct about shorting at $10 and covering at
$5
> > giving you
> > > a 100% profit. Unfortunately, it's only a 50% profit.
> > >
> > > Let's take the long example first, buying 100 shares.
> > >
> > > You buy a stock for $5.
> > > You sell it at $10.
> > > You invested $500 and made a $500 profit
> > > You have made a 100% profit.
> > >
> > >
> > > Now, let's take the short example:
> > >
> > > You short a stock at $10.
> > > You cover at $5.
> > > You invested $1000 (not $500) and made a $500 profit.
> > > You have made a 50% profit.
> > >
> > >
> > > The most you can EVER make by shorting a stock is 100%. The
> most
> > you can
> > > lose is your butt!
> > >
> > >
> > > -----Original Message-----
> > > From: peter j [mailto:amiabilityy@x...]
> > > Sent: Wednesday, April 30, 2003 3:42 PM
> > > To: amibroker@xxxxxxxxxxxxxxx
> > > Subject: [amibroker] how is the profit for shorts
calculated?
> > >
> > >
> > >
> > > This is about my tenth attempt to post this, i hope the
other
> > posts dont
> > > appear.
> > >
> > > Hi members.
> > > I have a question about short trades.
> > > Is the profit basically worked out similar to a long
profit.
> > > e.g. the buy to sell value
> > > In a short trade could the profit be worked out in reverse
> > > ( not in reference to ami, will be used for a spread sheet)
> > > e.g. If the short was $10.00 and the cover was $5,
> > > could i reverse these and say that there was a %100
profit.
> > > or are there oddities when working out the profit of a
short
> > trade.
> > > Peter.
> > >
> > >
> > >
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