The Controversy of Naked Short Selling

The Controversy of Naked Short Selling

By Monica Talasy
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July 10, 2024

Introduction

Naked short selling, a trading strategy often shrouded in controversy, has been a subject of intense debate in financial markets. This practice, which involves selling shares that have not been borrowed or located, has been both praised for its potential to expose fraudulent activities and criticized for its potential to manipulate markets and harm legitimate companies.

This article delves into the intricacies of naked short selling, exploring its mechanics, the arguments for and against its use, and the regulatory landscape that governs this complex trading strategy.

Understanding Naked Short Selling

The Arguments For and Against Naked Short Selling

The Regulatory Landscape of Naked Short Selling