May 8, 2009
As someone who is the owner of several investment businesses and who also shorts stocks from time to time, I urge you to reinstate the uptick rule. Since the uptick rule was taken out nearly two years ago, smaller investors like myself have taken a huge beating in the market from continued bear raids on positions I've held, seeing bigger players using short ETFs (some leveraged to highten their impacts) and see continuous signs every day of short seller raids of stocks. Even when I check if these stocks are available for shorting, I'm told they are not leading me to believe that naked short selling is still a massive problem in this market. Without the uptick rule in place, large players taking big Short ETF and naked short selling positions can slam stocks or groups of stocks down almost instantly. I've been burned many times from this type of activity and tired of being run over by these out of control players allowed to run rampid through our investment system. I've also see many tax clients 401K and retirement plans who have seen 50%+ losses in the past 12-18 months and much of this can be laid at the feed of this out of counrol short selling activity. Now as I've mentioned I've shorted stock myself, but always do so with shares I've borrowed and positioned my shorts orders to be executed on an uptick. I believe this is the way all investors should place these positions into play and a reinstatment of the uptick rule AND ban on Naked Short Selling of Stock is needed to restore a level playing field for all investors in the US markets.