Short selling Indices On Etoro

Short selling Indices  On Etoro , In this Post , i will  explain  how to open a Short Position in  Indices on Etoro platform

Note : Shorting , is risky , please be sure to do your homework and technical Analysis before opening a Short position.

 

What is  Short Selling  Indices?

When you open a Short Position in Indices, you are expecting Stock Market Indices  to drop in  later Period.

Short Selling Indices  means you borrow ” x “number of  unit s Indices Contract  from the Broker  ( Etoro ) and then Sell It at market Price.

What are the Risks ?

• When  the Indices  rise , you will loose money
• Price action might happen too fast , and swoop pass your Stop Loss amount
• Price Action Direction can always reverse due to  any news catalyst

 

Short selling Indices On Etoro ( Lets  get Started )

 

Step 1

Do your Home Work  , do your Technical Analysis ,

(1) Draw your trading Plan

(2) At what Price you will take profit

(3) At what Price you will Stop Loss

 

Step 2

Starting from Step 2, Base on your trading Plan  , we will step through on how open a short position

(1) After Signing Up your Etoro Account  , login to your Etoro Account and Click Trade Market

(2) At your Right Hand side Screen navigate to Indices and click view all

Step 3

After you Click View All , it will bring you to the Indices Market Page

(1) Click the NSDQ100 Image

(2) Click the Graph  Image

(3) Tile your Web Browser .

Normally for me when opening a trade  , i would  prefer to Tile my browser side by side so i have an Overview of the Price and control towards the  action that i will be executing

 

Step 4

Do Some Calculation

or you can use  a CFD Indices Calculator to Calculate

My Dummy Plan is as below

(1) Open Short Position : 12920

(2) Unit to Trade : 1 indices

(2) Take Profit : Indices  Drop to 12820 Exit trade  and Take Profit

(3) Stop Loss : Indices  Rise  to 13020  Exit  trade Stop Loss

(4) Leverage :  x 5 (Leverage 5 Time)

 

Some Calculation : 

Calculate Margin Required to Deposit to Open a Short Position

Margin Required :

Contract Size =  1  unit  Bought x 12920

=  USD 12920

Leverage  applied =  5

Margin Required = USD 12920 / 5

=  USD 2584

 

Calculate Take Profit

(1) You Borrow 1 Unit Of NSDQ100 Indices   and sell it at a Price of  USD 12920

(2) When the Indices Drop  to your target Numerical Number  12820 , the System will help you buy back 1 Unit Of NSDQ100 Indices at  Price USD 12820 , and return to Etoro

(3) Indices  Difference =  12920 – 12820 =  100 indices( Different ) (Positive)

(4) Your Contract Size =  1 Unit

(5) 1 Indices  = 1 USD

(6) Take Profit  = 100 indices x 1 = USD100 (Profit)

 

Calculate Stop Loss

(1) You Borrow 1 Unit Of NSDQ100 Indices   and sell it at a Price of  USD 12920

(2) Unfortunately the Indices Rise to 13020  , the System will help you buy back 1 Unit Of NSDQ100 Indices at  Price USD 13020 , and return to Etoro

Set The Number of Units  you want to Trade

(1) On your right hand Side Click the Unit Button

(2) Make sure after you click the Unit Button  , the Label on your right hand side display as unit

(3) Input the number of unit , in this case example is 1 unit

Set Leverage

(1) Click the Leverage Tab

(2) Select the Number of Leverage  you want ,In this case example leverage is set to 5

      Note: More Leverage means more amplified Profit in   contrast  means  more amplified Losses as well

Set Stop Loss

(1) Click the Stop Loss Tab

(2) Click Rate Button on your right hand side, after you click the rate button , please make sure that the Label on your left hand Side display as Rate

(3) Input your Stop Loss Price  , in this Case Example is  13020

 

Set Take Profit

(1) Click the Take Profit Tab

(2) Click Rate Button on your right hand side, after you click the rate button , please make sure that the Label on your left hand Side display as Rate

(3) Input your Take Profit  Price  , in this Case Example is  12820

Step 6

Click the  “Set Order “ Button

After you have done all your Setting , double Check and Click Set Order

When the Price hit your Set Order  12920

The System will execute a Short Sell Position