: What is the economic benefit to short a stock?

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What’s the purpose that benefits the whole of the economy? I don’t understand it’s purpose other than to bet on a losing stock. Is it purely for hoping a business will fail? Where is the benefit outside of the individual shorting? The idea of shorting a stock seems unmoral and unethical. Basically why is shorting even allowed to be a thing?

In: Economics

20 Answers

Anonymous 0 Comments

>What’s the purpose that benefits the whole of the economy?

Who said that there needed to be a purpose for that?

There is no game designer creating this action so humanity can benefit. 

Shorts are formed from simple contracts that people offer so they can make money off people screwing up. 

And people engineer and engage in shorting because *they* think they’re going to make money. 

Just a huge market of people trying to make money off each other. 

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