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... se a simple analogy like betting on small or big to explain long and short positions to clients who know nothing about finance. This straightforward explanation helps clients understand what they’re dealing with.

More specifically, let’s say a financial asset is priced at 100 units. At that point, A borrows one unit from B and sells it to someone else, pocketing 100.

Later, when the price drops to 50, A buys it back for 50 and returns it to B.

In this transaction, A profi ...

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