Shorting a Stock
When an investor shorts a stock, they are betting that the stock will go down. For example, if an investor thinks that stock XYZ will go down then he can ask his broker, in this case RobinHood, to borrow some shares. The investor decides to borrow ten shares at the price of $100 of stock XYZ. The next day, the price goes down to $90. Now the investor can give the broker the shares back at that price and the difference of $10 per share would be the profit. Since the investor borrowed ten shares and each one pays a profit of $10, then the total return on the trade is $100.
However, if the price were to go up to $110 the day after the short was made, then the investor is in the hole $100. The moral of the story when it comes to shorting stocks is down is profit and up is losses.