The European Union’s new rules on short selling came into effect on Nov 1st, 2012. The first ever pan-EU set of rules on short-selling, issued by the European Securities and Markets Authority (ESMA), not only bans naked short-selling of EU-listed shares but also imposes tough disclosure requirements harmonized across countries in the region, different from the several unenforceable directives issued in the past by ESMA’s predecessor CESR. The new rules apply to all securities whose principal trading venue is in the EU.
As an examination of investor holdings in the wake of the recent regulatory changes, Ipreo has surprisingly found that many institutional investors traditionally identified as “long-only” in fact possess some very large short positions.
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Published: 1 February, 2013