Stupid newbie question: sold what I didn't buy

I just got a margin account at IB and am using their TWS java client for trading. I wanted to buy 400 shares of Motorola at 20.60 but I guess I must've clicked an 'Ask price' cell without realizing it and ended up 'selling' 400 shares at 20.60, i.e. having a position of -400. When the price dropped to 20.55 a couple of minutes later I 'bought' back the 400. I think I might've made a quick $20 (minus commissions) on the trade but I don't really understand what I just did. Did I just do a 'put' or what? Thanks.

 

your kidding right? how did you pass the ib experience test?

 

You sold the stock short. In other words you borrowed the stock from your broker, sold it, rebought it, and gave it back to your broker. Your gain is due to buying it back for a lower price.

-Neo

 

Sounds like you just made your first short sale. Successfully at that.

 

You did a "SHORT"...and were lucky.
Double check you orders before you confirm them.
I made a mistake a couple months ago, but it was fat fingering the price on a stop order.

 

You just sold short then bought to cover. Don't feel bad. A very common mistake with a new platform. You might want to trade very small size until you get the hang of it.

 

http://www.investopedia.com/search/results.aspx?q=short+sale&submit=Go

 

My trading experience, while admittedly not at all sophisticated, goes back almost 20 years, back before there were Java clients , back before the World Wide Web was even invented. So it's been simply a lot of years of trading using phone calls to brokers. This is my first plunge into doing it online.

 

Unless you are trading options you did not "do" a put... You an have three positions in this game: (ET boys correct my french if needed... )

1. Long - You want the underlying security to go up in price because you bought it. If you sell at a higher price you profit. If you sell at a lower price you lose money.

2. Short - You want the underlying security to go down in price because you sold it. If you buy at a lower price you will profit. If you buy back at a higher price you lose money.

3. Cash - You are sitting on your hands and watching.... .

By your description, you were involved in #2..... not bad for your first trade.... the hard thing is keeping it up...

Good luck

 

Short Selling...

"He who sells what isn't his'n must buy it back or go to prison."

I think thats from the 30's, but I don't remember the attribution. Any help on that?
Jessie