What is the difference between a short position and a long position?

Investors maintain “long” security positions in the expectation that the stock will rise in value in the future. The opposite of a “long” position is a “short” position . A "short" position is generally the sale of a stock you do not own. Investors who sell short believe the price of the stock will decrease in value.

How does the long position work on TradingView?

The Long Position tool allows the user to set an entry point and assume a long position from that point . Extending above and below that price level will be two boxes; green for the profit zone and red for the loss zone.

How to add TP and SL on TradingView?

To set a stop loss and take profit after order that has already been opened, click on the edit icon on the order in the Positions tab. Step 6. Click the stop loss and take profit check boxes and enter the desired levels as a pips, price, USD, or percentage.

How does short and long work?

While going long involves buying a stock and then selling later, going short reverses this order of events . A short seller borrows stock from a broker and sells that into the market. Later the investor expects to repurchase the stock at a lower price, pocketing the difference between the sell and buy prices.

What is a long-short position strategy?

Long-short equity is an investment strategy that seeks to take a long position in underpriced stocks while selling short overpriced shares . Long-short seeks to augment traditional long-only investing by taking advantage of profit opportunities from securities identified as both under-valued and over-valued.

How to use Long and Short Position drawing tools? (2024)

Get started

This feature lets you estimate how an order will go if you go long or short, shows the Profit & Loss (PnL) and estimates risk and closing account balance when price reaches your profit target or stop loss levels.

You can practice placing orders and seeing results without actually having to place the orders — get confident and knowledgeable before risking real money in the markets.

Calculate your Position Size and Account Balance

1. Create a Long Position or Short Position drawing.

2. In properties dialog of the instrument enter your initial account size and risk amount (either in absolute numbers or as a % of your account size). You can also enter the Lot Size. Click OK to accept.

3. Drawing tool tags will show you position size (1) and account balance when positions are closed after reaching either the Take Profit (2) or the Stop Loss (3) level.

How are the Position Size and Account Balance calculated?

Long Position:

Position Size	Qty = (RiskSize / ((EntryPrice – StopPrice) * Point value)) / Lot Size
Account Balance when position is closed after reaching the Take Profit level	Amount = AccountSize + (ProfitLevel – EntryPrice) * Qty * Point value * Lot Size
Account Balance when position is closed after reaching the Stop Loss level	Amount = AccountSize — (EntryPrice – StopLevel) * Qty * Point value * Lot Size

Short Position:

Position Size	Qty = (RiskSize / ((StopPrice – EntryPrice) * Point Value))/ Lot Size
Account Balance when position is closed after reaching the Take Profit level	Amount = AccountSize + (EntryPrice – ProfitLevel) * Qty * Point value * Lot Size
Account Balance when position is closed after reaching the Stop Loss level	Amount = AccountSize — (StopLevel – EntryPrice) * Qty * Point value * Lot Size

AccountSize — initial account size specified in the settings
RiskSize =
- Risk, if risk is selected in absolute numbers,
- Risk / 100 * AccountSize, if risk is selected as a percentage of account size.

Display performance in the Compact Mode

Try using the Compact Mode if you want the position performance tags to consume less space on the chart. You can enable by choosing the Compact checkbox in Settings.

How are the Position Size and Account Balance calculated?

Long Position:

Position Size	Qty = (RiskSize / ((EntryPrice – StopPrice) * Point value)) / Lot Size
Account Balance when position is closed after reaching the Take Profit level	Amount = AccountSize + (ProfitLevel – EntryPrice) * Qty * Point value * Lot Size
Account Balance when position is closed after reaching the Stop Loss level	Amount = AccountSize — (EntryPrice – StopLevel) * Qty * Point value * Lot Size

Short Position:

Position Size	Qty = (RiskSize / ((StopPrice – EntryPrice) * Point Value))/ Lot Size
Account Balance when position is closed after reaching the Take Profit level	Amount = AccountSize + (EntryPrice – ProfitLevel) * Qty * Point value * Lot Size
Account Balance when position is closed after reaching the Stop Loss level	Amount = AccountSize — (StopLevel – EntryPrice) * Qty * Point value * Lot Size

AccountSize — initial account size specified in the settings
RiskSize =
- Risk, if risk is selected in absolute numbers,
- Risk / 100 * AccountSize, if risk is selected as a percentage of account size.

Display performance in the Compact Mode

Try using the Compact Mode if you want the position performance tags to consume less space on the chart. You can enable by choosing the Compact checkbox in Settings.

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How to use Long and Short Position drawing tools? (2024)

Calculate your Position Size and Account Balance

How are the Position Size and Account Balance calculated?

Long Position:

Short Position:

Display performance in the Compact Mode

How are the Position Size and Account Balance calculated?

Long Position:

Short Position:

Display performance in the Compact Mode

FAQs

What is the difference between a short position and a long position? ›