By Sarah Wood
Did you notice that the U.S. Securities and Exchange Commission voted last month to do away with its 70-year-old uptick rule? It's understandable if you weren't quite paying attention.
To be sure, the ruling was an historic and positive event for hedge funds. The change will create a more level playing field for short and long investors by eliminating a requirement that short-sellers wait for the price of a falling stock to reverse before shorting it. But at the same time, the industry seems as uninterested in shorting as it has ever been. "It's going to make it easier to lose money," is the cynical comment of one multibillion-dollar long/short manager, noting that "the price of being wrong [on a short pick] has never been higher."
Indeed, even as the deepening subprime mortgage crisis began to shake the euphoric equity markets last month, investors and...