Is Short Selling Can Be Viewed As Bullish

Online, April 22, 2013 (Newswire.com) - Heavy short selling means there's an opportunity to make money on the stock. When a shorted stock with heavy short selling begins to rise in value, you will likely see a big influx of short sellers moving back into the market and buying back the shorted stock to replace the initial position. If enough short sellers do this, a short squeeze would likely materialize, helping to drive up the price of the stock in the market. To further know topics like this go to www.investortrendz.com and widen up your knowledge about what this topic really implies in the stock market industry.

The two primary perceived risks of short selling are that: in the long term, markets trend upward and short selling can expose investors to potentially unlimited risk.

While the longest term market trend is indeed upward, there are reliable intermediate downward cycles (bear markets) that occur with a certain regularity. These bear-market declines tend to occur much faster than the run-ups that occur during bull markets. As what was seen of one of the topics at www.investortrendz.com which quoted that it is not uncommon to see the major stock averages decline 20% or more during these down cycles. During these periods it can actually be more risky to own stocks long than to be short, as most stocks go down during bear markets.

If practiced properly, short selling is no more risky than long stock purchases. More research is likely still needed, but one day researchers may conclude what many already believe: short selling is a much needed, effective method of regulating the markets. If more people were educated on short selling, there would be less fear surrounding it, which in turn could lead to a more balanced market over the long term. Find out what else is to know on stock market by getting a free and full trend analysis report here at www.investortrendz.com that would help you understand what this topic is all about.