How does a ban on short selling affect the futures market? For example, if you're short selling a security, how the implementation of a ban affect the futures market in terms of security as well? T it affect the price or call for a futures contract?
There is no current ban on short selling in a market in the United States.
The U.S. GOV / SEC will not ban short selling. They can change the rules, enforcement of existing rules, but not prohibit.
edit email Q:
The question is hypothetical, then? If so, I would say that if ultimately cash selling of listed securities has been banned and could still be below S & P stocks that the impact could still be affected.
If you can also simply buy options and convert these short positions that may still create short positions in stocks.
If short selling was banned in all markets around the world collectively, we would be creating a market artificially controlled, and therefore no longer have a free market.
Posted on February 3, 2010.