Short's should be used for insurance only. Trying to make money on them is, to say the least, very risky. The market trends upward about 6-10% per year. So with shorts, you're already spotting the market. But if you can't predict the direction of the market and don't want to cash out your entire portfolio (trading fees can bite you), shorts can cover your backside by reducing volatility. Then sell them ASAP when you think the market will trend upward again.