How going long and going short really work, why shorting can lose more than 100%, and how liquidation and funding treat each side.
Ready to put this into practice?Trade on Bybit — deep liquidity, low fees, up to a $30,000 welcome bonus.Open Bybit account →Every trade is a bet on direction. Going long means you buy expecting price to rise — the intuitive one. Going short means you profit when price falls: the exchange lends you the asset, you sell it now, and you buy it back cheaper later, pocketing the difference. Shorting is what lets traders make money in a bear market.
On a perpetual future you don't handle the borrowing manually — you just open a short position, and your PnL is the mirror of a long: price down = profit, price up = loss. The key asymmetry to respect: a long's maximum loss is 100% (price to zero), but a short's loss is theoretically unlimited, because price can rise indefinitely.
Short position calc →Longs get liquidated when price falls far enough; shorts get liquidated when price rises far enough. The maths is symmetric — at the same leverage, your liquidation price sits the same distance from entry, just on the other side. A short squeeze (price spiking up) is to shorts what a flush is to longs.
Liquidation price →Funding decides the ongoing cost of holding each side. When longs are crowded (positive funding), longs pay shorts — so being short actually earns you funding. When shorts are crowded (negative funding), the reverse. Over a long hold this can matter as much as the price move.
Funding calc →Back to Learn →To short, the exchange effectively lends you the asset; you sell it now and buy it back later. If price falls you buy back cheaper and keep the difference; if price rises you lose. On perpetual futures you just open a short position and your PnL mirrors a long.
In one way, yes: a long's maximum loss is 100% (price to zero), but a short's loss is theoretically unlimited because price can keep rising. Both can be liquidated — longs when price falls, shorts when it rises — so position sizing matters either way.
It depends on positioning. When longs are crowded (positive funding), shorts receive funding from longs. When shorts are crowded (negative funding), shorts pay. Funding can meaningfully change the cost of holding a position over time.
⚠️ Educational only — not financial advice. Leverage trading can lose your entire deposit.