Question

If an investor makes an investment in a way so that if the price of the asset rises, he makes profits, one says that he has taken a ________ position on that asset.

Answer 1

In the Short-term investment, it is critical for an individual or firm to ensure that he does not yield loss as that could be highly detrimental to his financial plans. Short term investments are usually specified with high investment at high returns. IN the case of the Short-term investment, the investment in the the assets are done in such a way that maximum returns can be gained from the investment , as only if an individual makes short term profit , that profit can be utilized for investment in the long-run.Therefore, the management of capital or assets in the Short-term becomes critical to the overall financial status of an investor. Therefore, if an investor makes an investment in a way that if the price of the asset rises, he makes profit, one says that he has taken a Working Capital Management position on that asset.