SEC may Reinstate Uptick Rule

stock777 · Mar 10, 2009

Quote from Anaconda:

Ok I agree with you for the most part, but why are you crying about the uptick rule? Are you really an equities daytrader or just a poser?

This thread is laughable, as 99% of the commentary is nonsense.

Most of these clowns are Jack Hershey pre graduates.

The only ones benefiting in the long run from the current rules are the black boxes.

bevo96 · Mar 10, 2009

Quote from stock777:

Most of these clowns are Jack Hershey pre graduates.

The only ones benefiting in the long run from the current rules are the black boxes.

You sir are a piker. Why would you advocate any constraints to your trading? The fact that you are a long homer is not a sufficient rationale for the up tick rule, its less efficient and it doesn't work. When I used to trade manually I could lean on bids with large size offered and you could make the stock drop without even having to transact. Everyone assumed it was an institutional short sale and bailed out of the way.

Anyways,this reinstatement is not as noble as you like to think. It is being pushed by the NYSE (Duncan Niederauer) for the benefit of the specialist firms and designated MM's (who will be exempted from the rule). The NASDAQ is hoping for a different solution.

On another note, suggesting that one can actually push a company below its TRUE fair value for any length of time is nonsense. Smart money is agnostic to the direction (long vs. short) of its position, it only looks for an edge against its perception of fair value. To suggest otherwise is uninformed. You dont see anyone "bear raiding" Exxon CDS's and "machine gunning" the bid do you? The company and others would come in and hammer the shorts if they moved the company to far below fair value.

I know basic market microstructure is lost on you, but it was worth a shot.

Sky123987 · Mar 10, 2009

Quote from bears21:

cross with arca

I wonder if you can get short on a cross

Anaconda · Mar 11, 2009

Quote from bevo96:

I know basic market microstructure is lost on you, but it was worth a shot.

This statement really ironic, considering the rest of your post.

moonmist · Mar 11, 2009

Quote from Roman Candle:

Wasnât the uptick rule in place during the tech crash? I donât think itâs going to make that much difference.

Uptick rule did not prevent the crash in 1987 ( Black Monday ) either.

dtrader98 · Mar 11, 2009

Quote from moonmist:

Uptick rule did not prevent the crash in 1987 ( Black Monday ) either.

Notice the 80A collar rule was put in place as a protection mechanism as a direct result of the 87 crash. Guess what other rule was simultaneously removed right before this debacle?
Couldn't have picked a better combination to exasperate a crash if you wanted to.

I'm sure it was just a coincidence.

NERVESASTEEL · Mar 11, 2009

Below is an email from ProShares regarding the impact of the rule on their Short products such as the SKF:

Thank you for your email regarding ProShares.

Any new uptick rule would first have to be approved by the SEC, then proposed for public comment, then finalized. Accordingly, until any rule is finalized, the impact on the management of our funds canât be known.

It is important to note that we may get our short exposure, not from shorting stocks, but from financial instruments, including swap agreements. When a swap counterparty has entered into a swap agreement with us, the swap counterparty decides whether or not it needs to hedge its exposureâand engaging in short selling of a stock is only one of several ways they may accomplish this.

If you would like to further discuss our products, please call us at #1-866-776-5125 and one of our Registered Representatives will be happy to assist you.

Sincerely,

Maureen Goff

ProSharesÂ®
Shareholder Services

patchie · Mar 11, 2009

Whether you think the rule will have an impact is somewhat irrelevant. Re-instating the rule will create the perception of security and stability in going back into investing. with all the accusations made that the loss of the uptick rule allowed for massive raids, re-instating it will bring back investors who left out of fear.

This doesn't have to work at the trade level - it has to work at the psychological level.

sprstpd · Mar 11, 2009

Quote from patchie:

Whether you think the rule will have an impact is somewhat irrelevant. Re-instating the rule will create the perception of security and stability in going back into investing. with all the accusations made that the loss of the uptick rule allowed for massive raids, re-instating it will bring back investors who left out of fear.

This doesn't have to work at the trade level - it has to work at the psychological level.

Yes, that will work for a day or two, until the averages make new lows.

gnome · Mar 11, 2009

Tempest in a Teapot... Emerging market stocks lose -90% in bear markets even with an uptick rule.

CNBS was discussing this earlier in the week... they claimed there often were 500 trades executed PER SECOND...

A market order short shouldn't have to wait any time at all to catch an uptick and get filled.... unless you're dealing in thinly traded issues.