Back in 2012 the EU passed a law in which short selling could be banned in certain market situations. They did so after coming to the conclusion that it added to the financial instability during the crisis. Our legal bods made the challenge on the basis it restricted trade in the City but the top EU court threw it out. We will not be able to opt out of the law either.
If I recall a short selling ban came into Spanish and Italian and Cyprus markets in 2012 and while it put pay to speculative shorting it didn’t stop holders of stocks and other securities smacking the sell button as fast as they could. I don’t agree with the law as markets should be able to function how they like (within reason). If your financial system wasn’t cocked up in the first place you would negate the need for specs to hammer it, but that’s just the trader in me talking.
Full story from the Beeb here
What do you guys and girls think, short selling ban, good or bad?
