Trading halt as ASIC clarifies ban on short selling
Trading on the Australian Securities Exchange (ASX) was delayed by almost an hour this morning as the market awaited an announcement from the Australian Securities and Investments Commission (ASIC).
The ASIC statement was a clarification of its announcement yesterday regarding the banning of short selling in Australian markets for at least the next month.
This morning’s statement said that the prohibitions on covered short sales would not apply to hedged positions that were put in place prior to the opening of trading this morning, when the ban was applied.
“The prohibitions on covered short sales will not apply to hedging a position that was taken by an entity prior to 22 September 2008 as part of its business of dealing as a principal in equities, options or derivatives (whether [over-the-counter] or exchange-traded) to fulfil orders received from clients or to respond to a client’s request to trade, in each case before that date,” ASIC said.
“ASIC will provide a no action letter for hedging of existing positions of market makers arising from their client business.”
ASIC announced a ban on naked short selling late on Friday, and yesterday extended that ban to cover short selling on the basis that similar moves had been put in place by France, Germany, Switzerland, Ireland and Canada.
The ASIC ban on short selling will remain in place for at least 30 days and the only exemptions will occur with respect to limited authorised market makers.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
