Chapter 02 · Section 2.1
Short DM
Suppose you hear the following statement: "Victor is short 250,000 March Deutsche Marks" This statement means that:
a) Victor has bought DM 250,000 more than he has sold for delivery in March.
b) Victor has sold DM 250,000 more than he has bought for delivery in March.
c) Victor lost DM 250,000 in March.
Being "short" describes having a liability. If you are short Deutsche Marks, you are a net debtor of Deutsche Marks. You owe more Deutsche Marks than you own.
The fact that Victor is short means that he has sold 1 Deutsche Marks without having bought them before.
"Short" is the contrary of "long".