Via ANCAPS: Funds see no silver bullet in the disgraceful short-selling ban

Short-selling bans will fail to put a floor under the sagging share prices of European financial stocks and bonds until mutual fund managers are convinced policymakers have a sure-fire plan to save the Euro zone project.

Regulators in France, Spain, Belgium and Italy will impose restrictions on market participants who seek handsome profits by betting on falling share prices from Friday, in moves aimed at diffusing volatility and repairing confidence.

But a crackdown on speculative short-selling is unlikely to arrest sell-offs from institutional investors who have decided they have little stomach for big holdings in banks and indebted governments who might call on them again for emergency capital.

"Putting a little Band-Aid on a wound that needs many stitches won't solve the issue. All that it'll do is reduce the credibility of the person who had the Band-Aid idea," said Pedro de Noronha, managing partner at hedge fund manager Noster Capital.

http://www.reuters.com/article/2011/08/12/us-shortbans-funds-idUSTRE77B13K20110812

there is also the other problem. If you cant mitigate risk shorting a stock then you will have to sell the position off. They are taking away the ability to hedge.

Short term works. People will hold positions SHORT term until they take impact from the first hit. Longer term stocks will be sold off.

Via ANCAPS: Funds see no silver bullet in the disgraceful short-selling ban

Via ANCAPS: Funds see no silver bullet in the disgraceful short-selling ban

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