SEC may Reinstate Uptick Rule

Quote from dtrader98:

The issue I have is with the methodology they used to argue that removal of the rule would have no impact on market volatility. If you go back and read the actual studies and pilot program that gave the green light, I think you'll find that it was very poorly conceived and horrendously biased. For one, anyone that understands out of sample testing and mining bias, knows that you don't conveniently pick a small window of low volatility to draw conclusions about the future inference of any hypothesis.

The mere fact that volatility wasn't explosive for the past 20+yrs since 87 should have been a simple enough argument to use the 'if it ain't broke don't fix it' principle. Of course, right after they put their fix in, the market imploded
(coincidentally perhaps, but about 80 yrs earlier than expected by any probabilistic model). And to simultaneously remove the 80A collar at the same instant was obviously not a bright idea in retrospect.

One has to wonder if it was only sheer ineptitude that generated the combined timing of these decisions.
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Ding! Ding! Ding!
We have a WINNER!!!
:D
 
How is this a winner? It doesn't matter about the biased sample, or the low volatility sampling period. The bottom line is the uptick rule doesnt apply to the big firms that trade 70-80% (one sided) of the market volume every day...it didnt when the SHO pilot was being run, it didn't before the pilot was run, and it won't if we go back to an uptick environment.
 
This is from briefing today:

12:28 Fed Chairman Bernanke says if the uptick rule had been in effect it might have had some benefit; says the SEC is looking at that, and will have to make a determination of whether it would be beneficial to restore it

Bernanke says traditional literature doesn't seem to find much impact of the uptick rule, but in the recent market environment, it might have had some benefit.

-Guru
 
Its the stupidest thing ever ( to re-instate the uptick rule). Markets today are not conrtolled by the retail traders but the institutions and they do not day trade ( most hedge funds trend trade) thus a penny up or 10 pennies up makes no difference. This is sheer ignorance by the politicians and people who know nothing about the market mechanics.
 
Quote from Landis82:

Turn on your brain.
This potential policy change is not just about the BANKS being priced appropriately . . . It's about slowing down the VELOCITY of the market.

We are talking about publicly traded companies here, with boards of directors, employees, that produce a good or service, etc. - - - Not some sort of a commodity.

In my opinion, former SEC Chairman Christopher Cox was simply yet another Bush appointee "flunkie".

The guy had no clue.
Either the most ignorant person on the face of this planet, or someone that was totally paid-off.

One or the other.
Take your pick.
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Cox was a willing participant for all we know, he was worthless either way you look at him and so is the SEC. At least now they have someone with a brain or who isn't bought out by some groups who love to short the market to death.
 
I think it's funny to see so many on ET complaining about this. It shows how many have not been in the game for over a year.

Any trader who traded with and without the uptick rule would be smiling at this. Except the automated systems traders.

All those extensive arguments & studies are hilarious. Bunch of worthless mumbo jumbo. Uptick rule is an effiency to be exploited, nothing more.
 
Feb. 25 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said there may be a benefit in resurrecting a rule that restricts short-selling stocks when share prices are falling amid the current bear market.

“In the kind of environment we have seen more recently” the so-called uptick rule “might have had some benefit,” Bernanke said in testimony before the House Financial Services Committee today. The rule, scrapped by the U.S. Securities and Exchange Commission in 2007, barred investors from betting against a stock until it sells at a higher price than the preceding trade.
 
with uptick rule it's very difficult to short stocks or sell stocks. most people who sell stocks hit the bid if they own shares.

if shorts can' short the market there is no incentive to crash the market. a good shorter can crash any stock or market.


Quote from stock777:

Feb. 25 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said there may be a benefit in resurrecting a rule that restricts short-selling stocks when share prices are falling amid the current bear market.

“In the kind of environment we have seen more recently” the so-called uptick rule “might have had some benefit,” Bernanke said in testimony before the House Financial Services Committee today. The rule, scrapped by the U.S. Securities and Exchange Commission in 2007, barred investors from betting against a stock until it sells at a higher price than the preceding trade.
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Quote from stock777:

Feb. 25 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said there may be a benefit in resurrecting a rule that restricts short-selling stocks when share prices are falling amid the current bear market.

“In the kind of environment we have seen more recently” the so-called uptick rule “might have had some benefit,” Bernanke said in testimony before the House Financial Services Committee today. The rule, scrapped by the U.S. Securities and Exchange Commission in 2007, barred investors from betting against a stock until it sells at a higher price than the preceding trade.
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Notice the lingo? "Betting" against a stock. That's what the outside world thinks of us. And it's going to get a whole lot worse. The Wall St. Titans did this to us.

I said it here a long time ago. The regulation coming will choke a horse. All because no one would step up and help us how many years ago. If we could have just had the SEC enforce regulations, we could have stopped this train wreck. But the payoffs were too good.
 
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