Short position

Selling first and buying back cheaper later, expecting price to fall. Possible with CFDs, futures and margin accounts.

Short selling a stock is done with borrowed shares and carries extra costs; in forex, CFDs and futures, opening a sell-side position is as easy as buying.

On a short position, the theoretical loss is unlimited (price can rise without limit), which makes a stop-loss even more important. Because declines are faster than rallies, short trades tend to be shorter.