The new rule on short sales would apply to any stock whose price has fallen at least 10 percent during a trading session. After that, short-selling would still be legal but only if the sale was at a price higher than the best bid price available at the time.
Thursday, February 25, 2010
SEC is divided but approves short-selling restriction
The Securities and Exchange Commission approved a measure restricting short sales of stocks when they are declining quickly, although the commission was split on the measure. Those in favor expressed hope that the move will improve investor confidence, while those against said no action was warranted. "While the alternative uptick-rule approach the SEC has adopted today is perhaps less disruptive than others that were considered, we are not convinced that implementation of this rule will provide net benefits to the capital markets and investors," said Ira Hammerman, senior managing director and general counsel at SIFMA. The SEC also said it is striving to approve a shift to international accounting standards by the end of next year.
The new rule on short sales would apply to any stock whose price has fallen at least 10 percent during a trading session. After that, short-selling would still be legal but only if the sale was at a price higher than the best bid price available at the time.
The new rule on short sales would apply to any stock whose price has fallen at least 10 percent during a trading session. After that, short-selling would still be legal but only if the sale was at a price higher than the best bid price available at the time.
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