this post was submitted on 05 Jun 2025
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AI must be stopped... (lemmy.world)
submitted 2 days ago by The_Picard_Maneuver@lemmy.world to c/whitepeopletwitter@sh.itjust.works
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[–] ManOMorphos@lemmy.world 1 points 1 day ago

It's never really "infinite" in practice. What it really means is that the amount you can lose isn't bound by the money you put into the trade. If you buy a stock normally, you can only lose up to the amount of money you used to buy it. With shorting, you can lose 5x, 10x, 20x the amount of money if things go wrong for you.