[system-traders] Stock Market Terminology

[João Antunes Costa <Joao.Antunes.Costa AT cgd.pt>]

Hi,

I was wondering if someone could elucidate me about the following.

What exactly is meant, by long trades and short trades?

Entering a long trade, means buying the stock, and exiting a long trade, means sell the stock, right?


What about short trades?  From what I've been reading, I get the impression that when you enter a short trade, it means to sell the stock you already have.  Then after price falls, you exit the short trade, and that means you buy the stock again.

Is any of this correct?  If so, does that mean that when you exit a short trade you are also entering a long trade, and vice-versa?

Sounds dumb, but I don't think I understand that yet.

Regards,
João