Thu, Nov 26, 2015
Welcome Guest
Free Trial RSS
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   |   
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. Other Voices: Hedge fund marketing and the selling cycle[more]

    By Bruce Frumerman. How long is the selling cycle now? That’s a question my financial communications and sales marketing consulting firm has been asked on a regular basis by hedge fund firm owners and sales people, ever since we opened the doors to our firm in 1987 pre-crash. Wa

  2. People - Solus Alternative Asset Management adds chief strategist from BTIG[more]

    From Daniel Greenhaus joined hedge fund manager Solus Alternative Asset Management as managing director and chief strategist. He will work closely with Chris Bondy, Solus’ chief economist, managing director and executive vice president, said Chris Pucillo, CEO and chief investmen

  3. Opalesque Roundtable: Seeding deal terms can be onerous for hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Executives from fund of funds firms, family offices, a placement agent, a private equity firm, and an accounting firm gathered in Connecticut last month for the

  4. Opalesque Roundtable: Family offices flock to co-investment[more]

    Bailey McCann, Opalesque New York: Co-investments have been a hot topic for pension funds in recent years, as they try to move away from high fees and improve transparency. But now, family offices are more readily getting into the mix and establishing in-house deal teams, according to the delega

  5. More institutional investors invest in CTAs compared to last year despite dissatisfaction with performance[more]

    Benedicte Gravrand, Opalesque Geneva: "Despite a strong start to 2015 for CTAs in Q1, commodity market conditions have made return generation difficult for fund managers over much of the rest of the year to date," says Preqin’s November