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Welcome to the list Elizabeth,
You are right about the first two - buy low sell high.
Shorting is sell high buy low - just the order is different.
I'm not familiar with your markets in the U.K. but in Australia it is near
impossible to "short" the market unless you trade in futures. Stocks traded
on the ASX can't be shorted. The closest we can get to shorting is with put
options or warrants, where you can profit by the price of a stock going down
in price. This may be the same in your country thus the term is not
familiar.
In countries where "shorting" operates, generally a trader who has a view
that the market or a security will decline in price can enter a contract to
sell the security at an agreed price. At a later date a buy contract on the
same security is made at a lower price and a profit is made on the
difference between the buy price and the contracted sell price. If the price
doesn't decline as expected traders who have shorted the market and change
their view on the direction of the market may reverse their positions which
is referred to as "short covering" which has happened a lot in gold over the
past six months.
Some on the list may have a simpler explaination but this might help to
start with. Good luck with your stock picking.
Ian Burgoyne
Melbourne
>From: Elizabeth Robson <bettyrob_uk@xxxxxxxxxxx>
>Reply-To: metastock@xxxxxxxxxxxxx
>To: metastock-list@xxxxxxxxxxxxx
>Subject: System Tester
>Date: Wed, 12 Apr 2000 08:08:56 +0100 (BST)
>
>Hi everyone
>
>As a newcomer to stockpicking I am puzzled by the
>terms used in the Metastock System Tester.
>I would appreciate any help on the meaning of the
>following terms:
>
>Enter Long
>Close Long
>Enter Short
>Close Short
>
>I believe Enter Long is when you buy stock, and Close
>Long is when you sell stock.
>But Enter Short and Close Short has me puzzled.
>Any explanation of the four terms would be most
>welcome.
>
>Elizabeth Robson
>
>
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