Short selling - maximum possible loss?

[A Nobody]

Theoretically you are correct when you are short your loss is unlimited.

In the real world, as the stock goes up you will receive margin calls or be forced to deposit additional cash and/or securities into your account, these additional deposits can and could be taken away from you as the short market value increases. Eventually as your losses keep climbing, your brokerage firm will close out your short position or the lender may demand their stock back

Donut Tim - in a short sale, the brokerage firms borrows the stock, not for the customer but for themselves, so that the firm does not carry an aged Fail to deliver.