Fri, Mar 29, 2024
A A A
Welcome Guest
Free Trial RSS pod
Get FREE trial access to our award winning publications
Industry Updates

MFA expresses concern regarding CESR'S European short sale disclosure rule proposal

Tuesday, March 02, 2010
Managed Funds Association ( MFA ) today expressed concern regarding a proposal from the Committee of European Securities Regulators (CESR) to require investors to publicly disclose short sale positions. MFA also expressed support for today’s proposal from the Hong Kong Securities and Futures Commission (SFC), under which investors would privately report short positions to regulators.

The CESR report recommends that its members adopt rules requiring investors to disclose publicly each short position in an equity security that exceeds a threshold level of 0.5% of a company’s issued share capital. MFA recently released an independent study that indicates that public disclosure regimes harm markets for all investors.

MFA looks forward to reviewing the text of the proposal in more detail, and working with European regulators to develop a framework that protects investors and enhances market integrity.

MFA strongly supports efforts to enhance investor confidence, improve existing regulatory frameworks, and establish smart, effective rules for capital markets. As regulators consider reform measures, it is important that they take into account the potential important effects of new disclosure requirements on investors, markets, and capital formation. MFA notes that a recent independent quantitative analysis of existing public short sale disclosure requirements in the United Kingdom (UK) by Oliver Wyman demonstrates that public disclosure of short positions has led to higher costs for all investors, including pension funds, endowments, and retail funds.

MFA supports the goal of increasing the level of information on short selling available to regulators, and believes that this goal could be achieved through private reporting of short positions to regulators. Private reporting would provide regulators with comprehensive short selling information that would allow them to identify and investigate any potentially abusive activity, while mitigating the consequences of public disclosure to markets and investors.

In this respect, MFA believes the regime announced today by the Hong Kong Securities and Futures Commission (SFC) is preferable for both markets and investors. Under the SFC regime investors would privately report short positions to regulators, who would then publish aggregated, anonymous information for each security on a delayed basis. Such a framework will provide important information to regulators while mitigating costs to investors. MFA looks forward to reviewing the details of the SFC proposal as they become available.

MFA condemns market abuse, which is distinct from legitimate short selling. MFA supports efforts of regulators to bring enforcement actions against market manipulators and other forms of market abuse. As investors, MFA members have a strong interest in stable, liquid, and honest markets.

About Managed Funds Association
MFA is the voice of the global alternative investment industry. Its members are professionals in hedge funds, funds of funds and managed futures funds, as well as industry service providers. Established in 1991, MFA is the primary source of information for policy makers and the media and the leading advocate for sound business practices and industry growth. MFA members include the vast majority of the largest hedge fund groups in the world who manage a substantial portion of the approximately $1.5 trillion invested in absolute return strategies. MFA is headquartered in Washington , D.C. , with an office in New York . -KM - Full press release: Source

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Previous Opalesque Exclusives                                  
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. KKR raises $6.4bn for the largest pan-Asia infrastructure fund[more]

    Laxman Pai, Opalesque Asia: The New York-based global investment firm KKR has raised a record $6.4bn for its second Asia-focused infrastructure fund, underlining investors' continued appetite for private markets. According to a media release from the alternative assets manager, the figure top

  2. Bucking the trend, top hedge fund makes plans for a second SPAC[more]

    From Institutional Investor: SPACs aren't dead. At least not to the folks at Cormorant Asset Management. The life sciences firm, whose hedge fund topped its peers in 2023, is confident it will match the success of its first blank-check company. Last week, the life sciences and biopharma speciali

  3. Benefit Street Partners closes fifth fund on $4.7 billion[more]

    Bailey McCann, Opalesque New York: Benefit Street Partners has closed its fifth flagship direct lending vehicle, BSP Debt Fund V, with $4.7 billion of investable capital across the strategy. Benefit Street invests primarily in privately originated, floating rate, senior secured loans. The fun

  4. 4 hedge fund themes that are working in 2024[more]

    From The Street: A poor earnings report from Tesla (TSLA) has not hurt the indexes on Thursday. The decline in Tesla stock, which is losing its position in the Magnificent Seven pantheon, is more than offset by strong earnings from IBM (IBM) and ServiceNow (NOW) . In addition, the much higher-t

  5. Opalesque Exclusive: A global macro fund eyes opportunities in bonds[more]

    Bailey McCann, Opalesque New York for New Managers: Munich-based ThirdYear Capital rebounded in 2023, following a tough year for global macro. The firm's flagship ART Global Macro strategy finished the year up 1