The Intended and Collateral Effects of Short-Sale Bans as a Regulatory Tool
Journal of Investment Management; Third Quarter, 2013
Posted: 15 Nov 2014
Date Written: September 30, 2013
Short-sale bans have been utilized globally as a regulatory tool during periods of financial crisis. This paper reviews the observed intended and unintended effects of short-sale bans. Research has documented pervasive effects spanning many financial markets that include options, convertible bonds, credit default swaps, and exchange-traded funds. Such implications should be of interest to regulators and policymakers when contemplating future bans.
Keywords: Short-sale ban, SEC, securities and exchange commission, short-sale constraints, financial crisis, price discovery, liquidity
JEL Classification: G00
Suggested Citation: Suggested Citation