I am just wondering if someone can give me a little more information on selling short?
I have been using a CFD Demo account for some time now and have made some large profits selling short on market opens but I could not quite
get my head around how I could sell a share for price that the stock never traded at.
Consider this example:
On the 4/8/11 the stock XXX Closed at $50.00 per share. Now I decide that tomorrow that stock is going to fall so I put a deal ticket in
to sell 1000 shares of the stock XXX at the price $49.95. On the 5/8/11 The share opens at $42.95 the following morning but my Sell
was still executed at $49.95 so I buy the shares back at the price of $42.95 per share having made a nice profit on the fall.
As you can read the example shows the I was able to sell the shares at an amount that was never traded, is this possible?
Thank you greatly.