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Ari Weinberg
FiLife Contributor

Ari Weinberg asked 8 months ago in Stocks

How will reinstating the uptick rule help the markets?

Didn't the rule just create an artificial floor by preventing bear raids? The idea is that you can't short a stock until someone has bought it. I would think that I should be able to sell short as frequently as I want, considering that someone is willing to lend it to me.

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Mark Kantrowitz
FiLife Contributor
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The uptick rule limits short-selling, slowing the pace. It is mainly an anti-fraud measure, but it also slows downward momentum plays. There is some reasonable belief that the removal of the rule may have contributed to the credit crisis.

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