Philip Hardy and Nick Shenton, Polar Capital

Conviction views on fundamental valuations and thorough understanding of risk-reward profiles are crucial when implementing short trades because they consume an ever-increasing proportion of one's risk budget if the shares rise rather than fall.

Due diligence, scenario analysis and constant reappraisal of the veracity of one's assumptions are ways to minimise potential for such an outcome.

In the current market context of heightened volatility, however, the single most important factor to consider