Over the past weeks Short Selling has been mentioned a few times in relation to Arafura in regards to the incredible number of negative post we have been reading on this thread ,so for the benefit of the newbie's I thought I would post the definition of short selling.
Short Selling :
when you short sell a stock, your broker will lend it to you. The stock will come from the brokerage's own inventory, from another one of the firm's customers, or from another brokerage firm. The shares are sold and the proceeds are credited to your account. Sooner or later, you must "close" the short by buying back the same number of shares (called covering) and returning them to your broker. If the price drops, you can buy back the stock at the lower price and make a profit on the difference.
If the price of the stock rises, you have to buy it back at the higher price, and you lose money.
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