How to sell short on etrade
How to Short Stock in Etrade 2022
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i don't want to waste your time so there
will not be an intro we're going to make
this video as short and sweet as
possible
now we are in the e-trade website we
have clicked on trading here this is the
page that comes up this is the page we
want you don't need to worry about this
stuff we're shorting stock so it's going
to automatically load on stocks which is
what we want
now you begin by putting in your symbol
we're going to do the s p etf for
example
once you put in your symbol and hit
enter
the price comes up right now the
market's closed so these aren't
fluctuating so this is basically
what it was at the end of the day
yesterday
all right these bid and ask sizes are
gonna be important in a minute
so
take a look here
what this means is there are
five people
who want to buy the s p 500
um for this price this is a max bidding
price at the moment
451.60
and there are 20 people 28 people who
want to sell it at
451.74 i'd say that's a pretty tight
spread
there's not a big difference 14 cent
difference between the bid and ask
when the spread is tight
you might want to go with a market order
which we'll look at in a second
but let's uh fill in the rest of this
stuff first so action down below the
symbol is action you want to choose sell
to short we are shorting the stock which
means we are selling shares of the stock
right away even though we don't own any
with the intention of buying those
shares back when the s p falls so we
will get the shares at a lower price
we're essentially taking our profit a
little early so what's going to happen
is we're going to sell short for
whatever quantity let's say we do 100
shares
and
for example we go with market order
and it's going to tell you down below
how much you'll expect to see in your
account after you go through this order
you will automatically get forty five
thousand dollars and the intention is
you're gonna buy back this hundred
shares later
hopefully cheaper and pocket the
difference
so like i said that bid to ask
spread right here is pretty important
because in general you're going to want
to go with a limit order
and a limit order
says that i want to sell the spy
for no lower than a certain price
so you can see that the bid is 451.60
maybe that's too low for me
i'm not willing to sell it at that price
let's say i want to sell it at
451.7
and um
that is what you will get if there's
enough bidders if there's a hundred
people bidding
or someone who's bidding for 100 shares
of the spy at that price
or
higher
now down below you see estimated
commission zero e-trade is done away
with commissions you only need to check
these proceeds and obviously that's
going to change as your limit price
changes
now this is this limit price is going to
be really important when you trade
something that's less liquid
so we'll look at ttac here which is a
very illiquid stock
you do the same thing sell short
100 quantity
and limit
now look at this bid and ask spread
that's a huge bid to ask spread
no one wants to sell this stuff
so you see this huge spread now
this is actually maybe two illiquid for
me um
let's switch to like
i don't know let's switch to the meme
stock
that's still pretty tight anyway
let me just show you what i usually do
for getting my limit
order filled at a good price
and hell let's just go back to spy
type in with one hand here all right
sell short 100 shares
limit order
i want to get the best possible price i
can the highest possible price i can
because that is going to
be my profit
so
i see the highest possible price is
451.74 but this is not being filled
currently
so you want to start a little bit lower
so let's say
451.73
put that in good for the day is fine you
can change this if you want but
generally the way i play it is just keep
it good for the day and kind of babysit
it
so um one more thing actually all or
none right here
means that
you if you click this it means you do
not
want to accept partial orders so if
someone's willing to buy
buy this from you
but they only want 50 at this price
if you click all or none that will not
be filled so you won't be left with
a 50
share short position
if you really just want to be short 100
shares
that's up to you if you're willing to
take a partial trade in general for
something
liquid like the spy it's always going to
get fully filled if not immediately
might be in in portions like a couple
seconds later
but here we go here's here's how i put
in the limit price
start
near the ask
and preview the order send the order
through
if it doesn't get filled
within let's say a minute
cancel the order come back here move it
down
now of course this is kind of penny
pinching but when you're playing with
big money it is actually quite you know
it's a lot of money if you're playing
100 shares of the spy
this this yeah this is a bit of penny
pinching but with something less liquid
you're probably moving down in
increments of 5 cents or moving down in
increments of
10 cents
and it's really going to make a
difference in the long run especially if
you're trading a lot
be aware though that if you are shorting
you have unlimited risk
the spy could go up to the moon and you
could lose everything
so there are ways to protect your
portfolio when you're shorting
or there are also ways that you can
mimic a short position such as through
options
which is my specialty
if you've got questions about that let
me know
the last thing we want to do is we i
just want to remind you how to close
this trade because a lot of people
will know how to open the trade and then
don't know what to do to close it
essentially all you're doing is the same
thing
you're putting in the same symbol but
you're switching the action to buy the
cover and you know let's
change the limit price because you want
to make a profit so let's say the spy
does what you think it does it falls
down to 440 or whatever you put in that
limit price you buy it back at 440
pocket the difference because you sold
it 450.
that i think basically covers it if
there's anything that you have questions
about let me know in the comments
section below and i will make a video to
answer your questions but i think that
covers it thanks guys and uh check out
demonvario.com for any more trading
information that you might be looking
for
