May 2009

LSE response to the FSA's consultation on short selling

In our response we reiterate that we consider short selling as a legitimate investment technique and a key component of a well functioning capital market. We also highlight the safeguards around short selling, especially naked short selling, already in place in the UK market such as a short settlement cycle and a strict settlement discipline. We recognise that greater transparency may be beneficial but we question the FSA's main drivers for its proposed disclosure regime. We argue that private disclosure of individual net short positions to the regulator, combined with public disclosure on an anonymous and aggregate basis, should go a long away to meet the FSA's policy objectives. Finally, we welcome the FSA's intention to work closely with European and international authorities on this issue and encourage the FSA to actively inform and influence the debate.

Downloads
London Stock Exchange response to the FSAs consultation on short selling (file pdf - 3 MB)