Short-sellers and their targets get a warning - Reuters

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An investor is reflected in a window in front of a board displaying stock prices at the Australian Securities Exchange (ASX) in Sydney, Australia May 5, 2017. REUTERS/Steven Saphore

Aggressive short-sellers are being urged to restrain themselves Down Under. The Australian Securities and Investments Commission on Tuesday issued guidelines for what it considers best practices. They include releasing reports outside trading hours, disclosing conflicts of interest and avoiding “overly emotive, intemperate or imprecise language.”

Many of the recommendations seem reasonable, and it’s encouraging that the regulator acknowledges the price-discovery benefits the most bearish investors bring. It’s not clear, though, whether stock bulls are required to be less effusive or similarly time their trading calls. At least Australia isn’t banning the practice as South Korea and others have.

ASIC seems to understand the art of the short. In addition to advising targeted companies to request a trading halt and respond promptly to attacks, it warns that activist campaigns tend to seek out “opaque corporate structures and accounting practices, or poor disclosure.” That perceptiveness doesn’t exactly square with another piece of guidance for short-sellers: to run their facts by their marks ahead of time. (By Jeffrey Goldfarb)

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Short-sellers and their targets get a warning - Reuters
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