@jfrhodes A shorter is a trader that believes the share price of a company will go down rather than up, and trade on this basis.
A short trade is done in reverse of a long trade. The trader sells at the higher price and then buys at the lower price. Of course they can't sell something they don't already have, and so they borrow shares from someone who already does own the shares to be able to sell them them.
They have to pay to borrow the shares and disclose the transaction to ASIC. You can monitor these new positions via websites including the ASX short report, or https://adgss.lvlworld.com (ie they will tell you the next day how many new short positions (sells) were taken, but not closed. To see when they are closed, you can use Shortman.com.au which gives you a graph of total positions over time. It's delayed by days, so with this you don't have current information about closing positions. Shorters will try to use this delay to their advantage. You will tend to find the down rampers become active after a day where a lot of shorts sales have been placed, to try to push the SP down. You may also notice more bot trading of small share parcels at lower price points during the day, to try to trigger stop loss sales.
The big risk for shorters is that the share price does not go down and the shorter needs to buy back at a higher price. In this instance, they lose because they pay to have the short position and they lose on the trade. In theory a shorter can lose much more money than a long trade, as the buy back price can go up multiples of the initial sell price. On a long, you can only lose 100%, rather than 200%, 500%. The instances where the share price goes up quickly is called a Short Squeeze. A recent example was the shorting on Liontown before the ALB $2.50 rejected TO offer. The SP swiftly went from $1.50ish to the take over offer price of $2.50ish.
Some countries overseas allow naked shorting, in which the shorter doesn't actually borrow the shares to sell. That is illegal in Australia. Some companies may try to influence market sentiment to be able to trade short.
Hope that helps.
GT1 Price at posting:
41.5¢ Sentiment: Buy Disclosure: Held
