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You're reading from  Algorithmic Short Selling with Python

Product typeBook
Published inSep 2021
PublisherPackt
ISBN-139781801815192
Edition1st Edition
Concepts
Financial Technology
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Author (1)
Laurent Bernut
Laurent Bernut
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Laurent Bernut

Laurent Bernut has 2 decades of experience in alternative investment space. After the US CPA, he compiled financial statements in Japanese and English for a Tokyo Stock Exchange-listed corporation. After serving as an analyst in two Tokyo-based hedge funds, he joined Fidelity Investments Japan as a dedicated quantitative short-seller. Laurent has built numerous portfolio management systems and developed several quantitative models across various platforms. He currently writes and runs algorithmic strategies and is an undisputed authority on short selling on Quora, where he was nominated top writer for 2017, 2018, and 2019.
Read more about Laurent Bernut

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The unique challenges of the short side

"When things go wrong, don't go with them."

– Elvis Presley, the King

People fail at short selling because they overlook three critical factors working against them: market dynamics, scarcity mentality, and asymmetry of information.

Market dynamics: short selling is not a stock-picking contest, but a position-sizing exercise

"This is space, the environment does not cooperate."

– The Martian

Successful longs expand. Successful shorts contract. On the long side, the market does the heavy lifting. On the short side, the market does not cooperate. Unsuccessful shorts balloon, while the successful ones shrink.

To illustrate this point, let's take a look at the table below. Imagine we have four stocks: two on the long side (A and B) and two on the short (C and D). The objective here is to illustrate how the long and short sides behave differently...

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Algorithmic Short Selling with Python
Published in: Sep 2021Publisher: PacktISBN-13: 9781801815192
© 2021 Packt Publishing Limited All Rights Reserved

Author (1)

author image
Laurent Bernut

Laurent Bernut has 2 decades of experience in alternative investment space. After the US CPA, he compiled financial statements in Japanese and English for a Tokyo Stock Exchange-listed corporation. After serving as an analyst in two Tokyo-based hedge funds, he joined Fidelity Investments Japan as a dedicated quantitative short-seller. Laurent has built numerous portfolio management systems and developed several quantitative models across various platforms. He currently writes and runs algorithmic strategies and is an undisputed authority on short selling on Quora, where he was nominated top writer for 2017, 2018, and 2019.
Read more about Laurent Bernut

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