A billionaire investor says it's time to short Facebook. Shorting stock -- borrowing the shares from a broker, selling them, and hoping to repay the stock loan by buying the shares in the open market at a lower price -- is a very risky trade. You could have done that by following a recommendation I made back in December 2006 to short shares of subprime loan originator NovaStar Financial when they were trading for $106 a piece. Gundlach is not offering this kind of rationale for shorting Facebook. There are many ways that Facebook could beat expectationsIf Facebook exceeds expectations, its shares will certainly rise - prompting a short squeeze -- 7.28% of its shares were sold short on March 29, according to Morningstar -- on anyone who takes Gundlach's advice.

Source: Forbes April 25, 2018 12:33 UTC