Tag: Short selling

The short-sell ban imposed by the China Securities Regulatory Commission was in direct response to the recent plummet in Chinese shares.  

The proposed changes aim to instil a positive obligation for market participants to have a reasonable expectation to settle any short sale before initiating an order. 

The EU watchdog will not renew the short selling reporting changes which are due to expire on 19 March, following an extension in December last year.

The resurgence in short selling and increased performance among hedge funds could pave the way for a profitable year for securities lending desks of banks. 

Short selling and margin financing volumes by offshore investors in China are set to take off following the new relaxation measures last month.

Short-selling bans, lower market volumes and depressed fees result in an 11% drop in securities finance revenues during 2020.

Citi, HSBC and Standard Chartered all successful facilitate margin financing and securities borrowing transactions in China for global investors under the Qualified Foreign Institutional Investors (QFII) scheme.

The massive fall in revenues was largely caused by lower market valuations and short-selling bans enacted worldwide by regulators. 

A study from EY and PASLA found 89% of its members believe securities lending is compatible with ESG principles.

Trade associations including AIMA and FIA EPTA have said the short selling restrictions have failed to curb volatility and could pose long-term damage.