this post was submitted on 02 Dec 2025
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[–] TotallyHuman@lemmy.ca 4 points 4 days ago (1 children)

You can hold a short position by repeatedly borrowing more stock -- but you run the risk of running out of money completely, because short positions have (theoretically) infinite downside risk.

[–] mortn@lemmy.world 1 points 3 days ago (1 children)

Financial risks can, by themselves, never be infinite. They are by nature quite finite. Also, risks are always alluding to a downside. Otherwise they're called chances.

[–] TotallyHuman@lemmy.ca 1 points 2 days ago

Granted. "Arbitrarily large" would probably be a better phrasing: if I buy a stock for $100 and the value drops to $0, I'm out $100. Can't lose more money than I put in. What I meant is that short positions, by their nature, don't have this ceiling on the amount of money you lose.