Let's take a look at what Long and Short positions really are, because this topic is quite important for anyone who wants to trade well.

Simply put, a Long position is opening a buy position. We expect the price to go up. For example, if we buy shares of PEAR at 350 baht and expect it to surge, when the price rises to 400 baht, we can sell for a profit of 50 baht per share. This is the concept of "buy low, sell high" that most people are familiar with.

But what's important is that Short is what adds flexibility for traders because it allows us to profit from a decline in price as well. A Short position or opening a Short means selling an asset first at a high price, then waiting for the price to drop, and buying it back at a lower price.

For example, Tim hears that ORANGE shares might have problems due to supply chain disruptions. He opens a Short position by borrowing shares and selling them at 350 baht. Later, the share price drops to 300 baht. He buys back at this price, making a profit of 50 baht per share. This is called "sell high, buy low."

What you need to remember is that short is a tool that isn't available for all assets. Some markets don't allow it. Some instruments like CFDs or derivatives are easier to use, but you must also be cautious of the risks.

The problem is that if your prediction is wrong, both Long and Short can incur losses. For example, if you buy Long and the price drops instead of rising, or if you Short and the price surges instead of falling, both cases result in losses. The key to understanding short is that it’s a tool that allows us not only to profit from upward trends but also from downward trends, as long as we can correctly predict the market direction.