This thread is certainly harsh if you don't agree with the consensus!! You need people to disagree to make it more interesting
, but I think you're better to argue the facts.
Anyway, it is definitely possible to make a 120% gain on a short:
- You have $100 of equity, but you short $200 of stock, then
- If the stock was shorted at $1 and drops to $0.4 then you make 60% on $200 i.e. $120
- So your return is $120 profit on $100 of equity i.e. 120% gain
You can make a lot more than 120% if you use more leverage. Look at your spreadbet account, you can short much more notional exposure than the equity in your account.
Despite the great potential shorting stocks with leverage is very dangerous!!
