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Some Policy Implications of Single-Stock Futures

8 Pages Posted: 28 Feb 2001  

Frank Partnoy

University of San Diego School of Law

Date Written: 2001

Abstract

On Dec. 15, 2000, Congress approved the use of single-stock futures. This essay analyzes some of the policy issues related to that approval. In particular, I discuss (1) the benefits and costs of margin rules applicable to single-stock futures, (2) the amendments to the securities laws to cover single-stock futures in areas such as insider trading and market manipulation, and (3) some potential benefits associated with the use of single-stock futures to avoid restrictions on shorting stock (e.g., the elimination of so-called "parent-subsidiary" anomalies, as when 3Com was worth less than Palm even though 3Com owned 95 percent of Palm's stock).

Suggested Citation

Partnoy, Frank, Some Policy Implications of Single-Stock Futures (2001). U San Diego Law & Econ Research Paper No. 10. Available at SSRN: https://ssrn.com/abstract=261896 or http://dx.doi.org/10.2139/ssrn.261896

Frank Partnoy (Contact Author)

University of San Diego School of Law ( email )

5998 Alcala Park
San Diego, CA 92110-2492
United States
619-260-2352 (Phone)
619-260-4180 (Fax)

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