China curbs short selling
The China Securities Regulatory Commission delivered, with new anti-short-selling rules aiming to stabilize the market going into effect on Monday:
- Per the new rules, investors who buy new shares will be barred from lending them out within an agreed “lock up” period, effectively closing off the mechanism used to bet against a stock.
- The move is similar to one China implemented during a similar period of market turmoil back in 2015, when activity from short-selling day traders was deemed as causing “abnormal fluctuations” in the market — a decision that ultimately failed to stem market losses in the following months.
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