Shorting and buying puts are two ways to profit from a SPAC (or stock) that is experiencing a downward movement. In short, what you’re doing when you’re shorting is borrowing shares from your brokerage, selling them immediately at the market price, and buying that number of shares back later on. The goal is that the price later on will be lower than what you initially sold for, so you will end up profiting the different.
Buying puts is the way to do this with options. You’re buying the option to sell the security at a particular price. If you’d like to dig more into the mechanics of options, click here to check out our guide.
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Extreme Profit Hunters