Short Selling for the Long Term: How a Combination of Short and Long Positions Leads to Investing Success
$16.60
Short Selling for the Long Term presents Joseph Parnes’s approach to combining long equity holdings with selected short positions. The book explains how he evaluates companies, interprets price behaviour, and adjusts portfolio composition within a longer-term investment process.
Parnes combines company fundamentals, cash flow, management assessment, and competitive position with technical analysis. Coverage includes the 50-day and 200-day moving averages, chart patterns, institutional activity, and the author’s “Parnes Parameters”—a framework he describes through pattern recognition, retrospective analysis, and Bayesian reasoning.
The portfolio discussion introduces long–short allocations, including the 130/30 model, and considers how exposure changes with investment objectives and market conditions. Short positions serve as a component of the broader strategy, with attention to liquidity, carrying costs, stop placement, and the difficulties of maintaining bearish positions.
Published in 2020, the book illustrates its approach through historical examples, a dedicated Chipotle short-selling case study, and additional long–short case studies and charts. It is suited to experienced equity investors seeking to examine a practitioner’s combined fundamental and technical investment process.
✅ What You’ll Learn
- Explain how long and short positions function together within the author’s portfolio framework.
- Distinguish gross long–short exposure from net market exposure using the 130/30 model.
- Interpret the 50-day and 200-day moving averages in the context of stock selection.
- Examine the reasoning and observations behind the Parnes Parameters.
- Assess management, valuation, cash flow, competition, and growth when researching companies.
- Combine fundamental assessments with price patterns, volume, and institutional activity.
- Identify liquidity, carrying-cost, and adverse-price-movement risks associated with short positions.
- Review how the author approaches diversification, exposure adjustments, and position-level stops.
- Trace the application of the framework through Chipotle and other historical case studies.
💡 Key Benefits
- Connects stock selection with the construction of a combined long–short portfolio.
- Brings fundamental research and technical analysis into one investment process.
- Provides historical examples for examining the author’s decisions and reasoning.
- Explains how short positions fit within a broader investment horizon.
- Highlights practical constraints that influence the implementation of short-selling ideas.
👤 Who This Book Is For
- Intermediate to advanced equity investors exploring portfolios that combine long and short holdings.
- Fundamental investors seeking to incorporate technical evidence into their research.
- Experienced short sellers examining a longer-term approach to selection and portfolio integration.
- Portfolio managers and investment professionals reviewing exposure, diversification, and position management.
📚 Table of Contents
- Investment Philosophy
- The Bank of England Lecture
- Portfolio Management—General Principles
- Explanation of the Use of the 50-Day Moving Average and 200-Day Moving Average
- The Theory Behind the “Parnes Parameters”: Using Pattern Recognition, Retrospective Analysis, and Bayesian Analytics
- Variables to Consider for the Parnes Parameters
- Shorting for the Long Term
- A Case Study for a Stock I Shorted for the Long Term—Chipotle
- Case Studies for Integrating Shorts for the Long Term with Longs
- Modern Trader Charts
Short Selling for the Long Term: How a Combination of Short and Long Positions Leads to Investing Success By Joseph Parnes
| Author(s) | |
|---|---|
| Product Type | Ebook |
| Format | |
| Skill Level | Intermediate to Advanced |
| Pages | 254 |
| Publication Year | 2020 |
| Delivery | Instant Download |
7 reviews for Short Selling for the Long Term: How a Combination of Short and Long Positions Leads to Investing Success
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Kaylie Vaughn (verified owner) –
Congratulations to Joe Parnes on writing his new book SHORT SELLING FOR THE LONG TERM . Joe has been an amazing friend and adviser to me and my family for many years and I value his expertise in investing and managing our accounts so beautifully. Both in good and tough times Joe is always our steady voice and I trust him completely. I am excited to read his new book!
Freya Lambert (verified owner) –
Joseph Parnes is one of these authors who think they are the only person in the world to possess common sense. The whole book is about realities that are self-evident, yet being presented as if only invaluable experience and rationality could provide them. If you are already a seasoned investors, this will be a waste of time. If you are a beginner, you won’t find in this book a clear step-by-step guide to investing. It’s 2020, give us a book with data because your common sense is not science nor is it interesting. Here’s the stupidest quote from the book: “Do not forget that there is not a loss in a short until you actually cover it at a loss”. Absolutely genius.
Remy Salazar (verified owner) –
Finally,after literally trying to understand short selling for past fifty years ( not exaggerating) it has been explained in an understandable way. I have asked many financial advisors for years to explain this to me and all failed. I finally came to the conclusion that they themselves didn’t get it.
Highly recommend this book to any one who would also like to understand short selling. As a bonus, what an amazing life’s journey this self made financial guru ( Joseph Parnes) has traveled.
Ansley Valdez (verified owner) –
I wish I had read this book before the Covid 19 debacle hit the market. This book makes sense, and is written so that average investors can really apply the principals to their own portfolios. While I had always avoided shorts, the way the book explains their application to the market is logical and productive. Unlike other “how to” books, this one focuses on concepts, so the reader is instructed how to think, not what to think. This is a very well done book.
Mario Cabrera (verified owner) –
What can I say? except that the market is so volatile and I decided to take a chance on how to not only short but to try to mitigate my depleting portfolio. The other books I saw were so old I can’t imagine they are truly applicable. Objectively, I have typically done well with long strategies . I have dabbled in Shorts, but they are darn hard to master. I found the book to provide some simple aspects to managing shorts in this crazy market, but I do wish that there was a little bit more to read. That being said, I can only say that I was able to use the material to mitigate my portfolio and have been able to actively trade and my portfolio which was on the decline has hemorrhaged. So I don’t want to project what will happen in the future, but I am using the information to understand how to try to better use short selling in this Covid 19 market and I am happy so far. My portfolio status tells me what makes sense
Kyler Lugo (verified owner) –
Interesting long short perspective. Interesting but simplistic technical analysis. Unrealistic in-depth analysis for individual investors to carry out. Way too much space allocated to outdated examples terminology much of which wasn’t relevant.
Zaid Faulkner (verified owner) –
I learned a great deal from reading this book. I never understood the mechanics of short selling, although I have been involved with investing for the past fifty years. Parnes’s explanations are clear and definitive. The history of short selling , and risks of the practice are described in detail.
Parnes’s investment philosophy is fascinating . He invests with both long and short positions in the same entity to yield more investment value per dollar, as well as a hedge against losses in those entities.
I found the analysis of stock charts to be especially intriguing. Terms like the “death cross,” “resistance line,” and “short squeeze” add both adventure and understanding when studying stock charts.
Charts and the analyses thereof of several well-known companies are included in SHORT SELLING for the LONG TERM. I recommend that this book be used as a textbook for students of finance and investment guidance.
I have Joseph Parnes’s book, SHORT SELLING for the LONG TERM in my library right next to Graham and Dodd’s SECURITY ANALYSIS. These books are both classics for the finance profession