"MUCH ADO ABOUT NOTHING": SHORT SELLING BAN EFFECTIVENESS ON BANK STOCK PRICESDownload This Article
Most regulators around the world reacted to the 2007-09 crisis by imposing bans on short selling. Using data from seven equity markets, this study empirically examines the impact of the 2008 short-selling bans on financial stocks. Using panel and matching techniques, evidence indicates that bans on short-selling (i) on the whole widen volatility both in terms of High-Low spread and GARCH analysis, (ii) were not able to reduce systematic risk, (iii) overall failed to support prices. On the whole our results are in line with previous literature.
Keywords: Short Selling Ban, Event Studies, Garch Analysis, Financial Crisis, Systematic Risk, Financial Regulation
How to cite this paper: Galloppo, G., Aliano, M., & Youssef A. (2014). "Much ado about nothing": Short selling ban effectiveness on bank stock prices. Risk governance & control: financial markets & institutions, 4(4), 48-60. https://doi.org/10.22495/rgcv4i4art6