April 20, 2022
I fully support disclosure by funds, asset managers, brokers, prime brokers, and related parties, of their short positions.
There is really very little reason why they should not have to report a short position, and it's clear that these entities already have a significant advantage in the market, but this would go a small way to balancing things. Work must also be done to ensure these parties are not able to abuse their short reporting obligations by creating the illusion of a different position to the actual position. Currently the evidence suggests that funds are using complex derivative positions like options and swaps to hide their true short positions. FTDs are mounting up and not being cleared. Dark pools are being used to suppress price by harbouring buy orders, while sells make it to the lit market. It is only fair if market participants are obliged to share their short positions, in the same way that they can see the short positions of retail investors (especially when a hedge fund also operates as a market maker, which is another conflict altogether). Let's also not forget that - if passed - this is going to be a self-reported obligation, so I have little faith that it is impervious to corruption, but it should be passed for at least a chance at more transparency.