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Going Short: The Basics
Going Short: The Basics

September 28, 2022

Each athlete on Mojo has a Share Price that represents the public’s latest statistical expectation for a player’s entire career. Expectations — and therefore share prices — constantly change, based on factors like performance, news, and market sentiment.

What if you think a player’s share price is more likely to go down than up? Or what if you just don’t particularly like a player and it sounds fun to root against them?

On Mojo, you can profit when an athlete’s share price goes down when you Short that athlete’s stock!

What is shorting on Mojo?

Shorting the real stock market is complicated and risky, but we made shorting on Mojo simple and dramatically reduced the risk.

  1. Simple: Payout = entry price - exit price. For example, if you trade short one full share of a player at $20 and the price drops to $10, you can exit your short position to make roughly $10. (We say “roughly” because Mojo charges modest commissions to keep the lights on! That’s our business model.)
  2. Less risky: You can never lose more money than you initially invested.

When you trade short, you're expecting that a player will underperform their market value. You think they're overrated by the crowd! As the price goes down, your gains go up. Your maximum upside is double your money and your losses are capped at your original purchase amount.

Why does Mojo offer shorting?

The short answer (pun intended, the author is a dad) is: for fun! Everything on Mojo is supposed to be fun. Mojo should NOT be where you invest your retirement savings.

The longer answer is that to offer the first true sports stock market, with stock prices that go up and down just like real stocks, Mojo needs shorting. Without shorting, how would the market (that’s you guys!) signal that a player’s share price is too high? For example, if Zach Wilson’s IPO price were $200 (that’s WAY more than Tom Brady’s!) then no one would ever trade his shares. Mojo relies on the wisdom of the crowd to signal that a share price is too low, but we also rely on the public to signal that a price is too high.

Here’s the short of it:

  • When you Go Short you want the stock to drop in value. This is great when you think a player is overrated. Or you just want to root against them for fun!
  • When you Go Short your max loss is capped. Even if the stock rises more than 100%, you wont lose more than what you paid to purchase the shares.
  • When you Go Short your max profit is also capped. If you go short one share of a rookie at $50 and they retire with $0 Mojo Value, your max profit is $50 per share. (It’s technically possible for someone to retire with negative Mojo Value, but shares never drop below $0.)

Want to learn more? Check out these essential blog posts:

And don't forget to follow @mojo on Twitter,  Instagram, TikTok and YouTube

Thomas Trudeau is a full time employee of Mojo. All trades you make are with Mojo, which sets the lines as the “house”. Recommendations are for entertainment purposes only. Please use your own judgment and data to make trades. 21+. Must be in NJ to trade. Gambling Problem? 1-800-GAMBLER
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