Why I don’t trade on the short side?

I only trade the Australian and U.S. markets on the long side. I don’t trade short.

I use to trade short but I stopped in 2009. There’s a couple of reasons. First of all, I’ve never really come across a strategy I’m 100% happy with. I can find strategies that make a profit trading on the short side but the risk adjusted return is such that is really doesn’t appeal to me. The second reason and probably the most important reason is back in 2008 the Australian regulators banned short selling. What’s the point of having a strategy to trade on the short side and when you need it the most you’re not allowed to trade it? So I just focused on the long side.

Another reason why we also trade majority on the long side is because it’s easy for people to conceptualise. My clients want simple strategies and trading on the short side adds complexity. When there’s no trading, we sit in cash.