Tue, Aug 23, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

EDHEC-Risk Institute lists weight of evidence on effects of short selling and high frequency trading

Wednesday, February 27, 2013

Beverly Chandler, Opalesque London: Frédéric Ducoulombier, Director of Executive Education, EDHEC-Risk Institute and Director, EDHEC Risk Institute–Asia comments on the proposed restrictions on trading which have been thrown up by the global financial crisis in this month’s Edhec-Risk newsletter. Ducoulombier reflects on the academic studies which have concluded that short sellers contribute positively to market efficiency. "Research that has been undertaken by Securities and markets regulators around the world introduced bans on short-selling at different stages of development of the recent crisis, purportedly to halt price falls, reduce volatility and, in the words of former chairman of the Securities and Exchange Commission Christopher Cox, 'restore equilibrium to the markets’" Ducoulombier writes.

"These hasty decisions were not only devoid of theoretical basis, but also flew in the face of empirical evidence. Academic studies, including work by EDHEC-Risk Institute researchers, had documented the positive contribution of short-sellers to market efficiency and shown that constraining short sales significantly reduced market quality – by reducing liquidity and increasing volatility – and could have unintended spillover effects."

In a series of articles published or forthcoming in leading academic journals, EDHEC Business School Professor Ekkehart Boehmer, w......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: Algorithms platform aims to target typical challenges found in quantitative hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva: Last month, Quantopian received investments from Point72 Ventures, the new venture capital arm of Steven Cohen’s Point72 Asset Management.

  2. LatAm hedge funds surge in 1H to +24.4%, emerging markets assets rise[more]

    Komfie Manalo, Opalesque Asia: Hedge funds investing in Latin America posted strong gains through mid-2016, reversing declines in four of the past five years, including the last three years, to lead all areas of hedge fund performance through the first half of 2016, according to the latest HFR Em

  3. Opalesque Roundtable: Low and high fee investments often better than mid fee hedge funds[more]

    Komfie Manalo, Opalesque Asia: Hedge funds that charge the low and high fees stuff often provide better returns than "those sort of mid-fee investments", said Keith Haydon, chief investment officer of Man FRM. (Alternative) investment managers who charge high fees would often provide the most int

  4. Hedge fund investors pull $5.7 billion in July[more]

    From Bloomberg.com: Hedge funds suffered a third consecutive month of outflows in July as investors withdrew $5.7 billion, according to industry tracker Eurekahedge. Redemptions totaled $20.7 billion in the three months through July, with money managers betting on equities suffering $18.4 bill

  5. …And Finally - Police contact Catholic Church after baffling ‘poltergeist’ report[more]

    From Telegraph.co.uk: Police officers in Scotland have called in representatives from the Catholic Church after investigating reports of “disturbing incidents” of a "poltergeist" at a family home. A mother and her teenage son were said to be “extremely distressed” after experiencing what the D