Before you can perform this trick you need to raise the Barter skill to level 10. This will allow you to sell the following items for more money than it costs to buy them; Health Potion, Mana Potion, Town Portal Scroll & Identify Scroll. You can purchase as many of these items as you want (hold down the 'X' button) and sell them back to the shop for a 20% profit. This trick can be repeated as many times as you desire. This will not work for the larger Health and Mana Potions, only the regular ones.
At the town of Torchlight open the 'Pause' menu. Then return to the 'Title' screen and save the game. Reload the same file and place any items you want to clone in the shared stash. Sign out of Xbox Live so you are returned to the 'Title' screen. Now sign in again and reload your file and any items you stashed will also exist in your inventory.