Mr. Mojo
Jr. Member
OK I am not an investor, but at one time had a mutual fund,luckily I sold out before 2007. What I don't understand is how can someone "short" a stock? Where does the values come from? When someone buys a stock and it goes up in value, then demand will clearly require a higher value for the stock. When you buy a short on a stock, where does the value come from if the firm you are shorting does what you want? Who pays you for your short on the stock, and how is the value computed? Is there a parallel financial universe that I have missed out on understanding?
Thanks
Thanks