Tim Farrar

A Short Comment on Shorting

Grammatical errors aside, I thought that your article was a reasonable argument for doing what is comfortable. However, I find "comfortable" to be uncomfortable. Comfort is an argument for mediocrity, in which case, I would just buy and hold index funds and be done with it. There are numerous ways to take advantage of share prices going down that are less risky than outright shorting the stock. Maybe get outside the box and explore them with small positions that will not wipe you out if they go against you. Even better, some brokers offer virtual trading platforms where you risk no capital while you learn something uncomfortable.

BTW, while O'Neal understands shorting, has done it profitably, and has written about it, he also says that he has not been as successful with shorting and that he has done it infrequently. He tends to trade from the long-side or the short-side only when the set-up is compelling.