When do they start asking for money-how much does it have to fall if you go short on a stock?

Question

So say you go short on a stock that's 30 dollars a share and you short 100 shares for 3 thousand. You would still have a POSITIVE supply-you getting yourself out of the position of buying the stock back that you short sold you would still be in the positive until it went up to 60 bucks right? If not what price would you have to buy the stock you shorted to hit exactly 0 bucks? in other words there is a point in which when you short you can lose more than you shorted i.e. 3,000. in my example when would that be?

Answer 1

When I short a stock I make sure it's in a defined down trend. As soon as it breaks that trend it's usually wise to get out. No sense in being greedy, use stops to get out if it goes up while your away. A 10% gain is better than a 2% lose.

Answer 2

If you short a stock at 30$, then if the stock goes above 30$ you're losing money. It will cost more than 3K to cover, to buy back the shares you've borrowed. If the stock goes to $60, then you would need 6K to cover your short. Don't forget that you have to buy back the shares you borrowed when you shorted. Your broker will "start asking for money" when your losses exceed your margin limit.