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Shorting US Stocks

  • 10-01-2022 7:25am
    #1
    Registered Users Posts: 2,733 ✭✭✭ El Rifle


    I'm looking to short a few US stocks, and am wondering the best way to do this? Should I get an account with Goodbody or Davys and go about it that way? I've signed up to Degiro and am awaiting approval - is it possible to do it there? Is there any regulations against shorting these days? I remember talk about banning it in the US not so long ago.



Comments

  • Registered Users Posts: 1,854 ✭✭✭ Atlas_IRL


    Dont think you can do it in DeGiro for US stocks, i know for options its only EU stocks. If you wanted to sell puts you can use Interactive Brokers. I think you can short on a few cfd platforms as well. No idea on the regulations, i wouldn't touch it myself.



  • Registered Users Posts: 512 ✭✭✭ MakersMark


    You need to be careful.


    One of my old bosses shorted ADAM $2.....

    Look at it now....he lost his arse!



  • Registered Users Posts: 2,733 ✭✭✭ El Rifle


    I just think we are going to see some drops in the US this year. Interest rate rises over there are going to change the game, and they are coming soon unless there is a late change of heart!



  • Registered Users Posts: 3,961 ✭✭✭ Diarmuid




  • Registered Users Posts: 3,236 ✭✭✭ brainboru1104


    *buys popcorn 🍿*



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  • Registered Users Posts: 590 ✭✭✭ transylman


    I was planning on shorting a company in September of 2018. The CEO had behaved very erratically at the May earnings call that year, he had publicly lied about taking the company private seemingly as a joke, there were endless delays in the delivery of their newest product and serious questions over whether there would be any demand for it, there were a series of large loans about to come due and the company was rapidly running out of cash. All indications were the company was about to go bust and I was planning on putting around 10% of my savings into the short position.

    That company was Tesla and if I had gone ahead with it and stuck with it I would have been wiped out as the share price has 20x since. Fortunately I was with Degiro and shorting a US stock was not an option.



  • Registered Users Posts: 2,733 ✭✭✭ El Rifle


    The way I see it, companies that have very high debt are going to hurt a lot when interest rates go up. Cashflow is going to be affected, and ability to pay back the debt. Couple that with a change in investor attitude when they finally do raise interest rates after what 13 years? I can see a lot of stocks suffering.

    It seems you can short on Degiro by putting in a sell price. Although Im assuming max losses can be pegged, and if not I'd not be so bold probably to do it. Still waiting to get it all set up to go.



  • Registered Users Posts: 3,236 ✭✭✭ brainboru1104


    https://www.macrotrends.net/2015/fed-funds-rate-historical-chart



  • Registered Users Posts: 590 ✭✭✭ transylman


    DeGiro wont let you short US stocks or category D european stocks.

    If you are absolutely set on going ahead with this then I advise you would limit your short position to less than 5% of your savings. Shorts are oppposite to shares in terms of gains/losses, your max gain is 100% and your max loss is potentially stratospheric.



  • Registered Users Posts: 2,733 ✭✭✭ El Rifle


    Wasnt aware about the max losses. Sounds like territory for a professional investor then. Better stick to the things that might rise when the rates go up so. Thanks for the input!



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  • Registered Users Posts: 973 ✭✭✭ greenfield21


    It surely depends on what company you are shorting, I don't think anybody is saying to go out there and short small to medium size growth stocks and then get completely washed out with huge losses. It's way too high risk...but if you think as some do over the last while that the era of free money is over and the market will go down then why wouldn't you place a short position. I don't do it my self ( as I don't try and trade) but surely you could find a large cap company that is tracking the qqq or the sp500 and use it to bet against the market.



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