There is no road map for short sellers. This leaves them two options: Make their own mistakes, or learn from those who have already made them. Greg Blotnick, CFA, has found the latter approach is far cheaper.
The best short sellers share one key personality trait: empathy, or the ability to put themselves in their counterparty’s shoes, says Greg Blotnick, CFA. Before initiating any short position, make sure to know the answer to the three questions he poses.
The famed short-seller and his colleagues recently analyzed their investment track record and discovered, to their surprise, that the firm's most successful investments turned out to be “value traps.”