Short selling is simply part of normal market functioning
Why this worry about an activity that is routine and commonplace in the currency, futures and commodities markets?
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EVERY time stocks plunge as drastically as they did in early April following the announcement of the Trump tariffs, the issue of whether to curb short selling gets revived.
On Apr 8, for instance, in response to the US tariff-led pressure, Thailand announced a ban on short selling of stocks and tightened other share trading rules to curb volatility. The ban on short selling of all securities, except for market makers, lasted until Apr 11.
Also in early April, Taiwan’s Financial Supervisory Commission limited for about one week the number of shares that could be sold short and raised the minimum short selling margin ratio from 90 to 130 per cent.
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