Far from hating short selling, regulators see it as a legitimate and necessary part of equity trading, explains Martin Wheatley, chief executive of Hong Kong’s Securities and Futures Commission. He chaired the taskforce on short selling, charged by the International Organisation of Securities Commissions’ Technical Committee with examining how the practice should be regulated. A week after the report’s publication, Wheatley reveals to FOi’s Agnieszka Troszkiewicz why the committee believes short selling is justified, what it thinks of last year’s ban and what regulators need to do next.
FOi: The consultation paper on short selling produced by your task force has been described as steering a middle course: you acknowledge that short selling is a legitimate technique but at the same time that it needs to be controlled. Is that a fair description?
Martin Wheatley: What we’ve said – and I...