What is a "Short Position"?

A "Short Position" is a strategy in financial markets where an investor profits from the decline in the price of an asset. Unlike the traditional approach of buying with the expectation of price growth, in a short position, the trader "sells" an asset they do not own, anticipating its price will drop. When the price falls, the trader buys the asset back at a lower price, profiting from the difference. This approach is mainly used in stock and cryptocurrency markets, but it requires careful analysis, as losses can be unlimited if the asset's price rises.