Temporary short-selling bans imposed earlier this month by
the financial market authorities in France, Italy, Belgium and
Spain have been broadly criticised by both the Alternative
Investment Management Association and the EDHEC-Risk
The bans, on specific banks and financial stocks, were
imposed on 11 August following several days of high volatility
in the sector.
"We do not think these bans will help the current market
situation," said a statement by AIMA CEO Andrew Baker. "Past
experience has shown that bans on short selling do not prevent
market falls and indeed can exacerbate volatility. Independent
academic research also supports this conclusion."
Baker went on to describe short-selling as "a legitimate