Why you should learn about short selling

Should you learn about short selling? Most definitively. Short selling and knowing about it are two different matters. So even if you do not wish to engage in the practice (which is understandable given its drawbacks), understanding the approach of a short seller/bear will allow you to develop a well-rounded outlook and skill set as an investor/trader, which can only be a good thing. Here are some reasons why nurturing your inner bear is time well spent.


Given the limited upside and unlimited downside to shorting, those who do it are very thorough with their due diligence. Short sellers spend hours going through filings, news articles and research papers as well as carefully researching the backgrounds of the people involved with publicly listed companies. This is a very time-consuming task, meaning that short sellers have developed techniques and methods that allow them increase the quality of their research while reducing the time spent on it.


Timing is of utmost importance to the short seller. Short sell too early and he/she will lose money, too late and he/she will miss the bus as due to the uptick rule. As a result, short sellers need to have a solid foundation as far as technical analysis is concerned. Price action, volume fluctuations and key indicators need to be well understood in order to devise successful trading strategies.


Short sellers are not popular; they are contrarians by nature. Expressing negative views about a company will often result fair amount of vitriol from current shareholders, sometimes even the management. This will teach you to deal with detractors and abuse in a calm and restrained manner. Keeping a cool head is important when dealing with the highly volatile and often times emotional world of trading.


Questioning and assessing the nature and value of information is paramount for well informed decision making. Short sellers are very sceptical by nature. This information must also be deemed varied and balanced. Short sellers are always on the lookout for negative information that counters the dominant bullish narratives. Understanding the short seller’s approach to trading can thus provide an insight into a frame of mind that makes use of a few critical thinking skills.

All in all, little can be lost from learning about something, especially if it can make you money. If you wish to learn about short selling or take it to the next level, please have a look the services offered by the Utopia Capital Research team.

Ready to jump in?

Become a part of our community

Alert Service
  • Trade alerts, short reports and other content straight to your inbox as soon as published.
  • Take full advantage of trade our calls before others do.
  • Monthly Membership - Cancel anytime
Your Due Dilligence Report
  • Your Due Dilligence Report aims to provide you with customized ticker specific real time institutional-grade independent research thats not only limited to hedgefunds and investment banks but affordable to the everyday investor who wish an updated red flag list on your ticker of interest.
  • Unlike Wall Street investment banks, we don’t get paid by companies to talk about them. Your Due Dilligence Research Report takes a forensic due dilligence approach that looks for red flags that might shed light on unseen risk in your decission making of your current and future portfolio.

Following red flags will if found be listed in Your Due Dilligence Report

  • Artificially inflated stock prices.
  • False and misleading positive statements.
  • Accounting irregularities.
  • Bad actors in management or related affiliates.
  • Undisclosed related-party transactions.
  • Illegal/unethical business or financial reporting practices.
  • Undisclosed regulatory, product, or financial issues.
  • Financially distressed/shell risk.
  • Share issuance / dilution of shareholder value.
  • Foreign listed companies.

Please Email us in advance with your ticker/s of interest with an estimate of possibility and time to deliver Your Due Dilligence Report on research@utopiacap.com

Community Chat Room Monthly
  • Receive our trade alerts, short reports and other content straight to your inbox as soon as published. Take full advantage of trade our calls before others do.
  • Daily premarket watch list.
  • Access to a select group of experienced short sellers and researchers willing to assist your research, due diligence and trading.
  • Access to information from our database of previously traded and suspect tickers, people involved with these tickers, useful information sources, promotional material (such as pump articles and landing pages) and court cases.
  • Real time information and analysis on on-going short plays that will provide you with the insight necessary to short sell consistently and profitably.
  • Discussion of all of our trades in detail, including research and trading strategy. All of the content in our short reports and trade alerts is discussed here hours/days ahead of publication in addition to several other short trading opportunities.
  • Monthly Membership - Cancel anytime
  • Before joining please contact us. research@utopiacap.com.
  • After signing up, please log in here.

After purchasing membership above, access to our chat service can be found here

If you require further information about our premium service please contact us at research@utopiacap.com.

%d bloggers like this: