The IMA has defended the use of short selling by investment managers and argues they should not be forced to disclose their positions to the wider market.
However, it states while short position disclosure to the regulator is an important check on the markets wider disclosure is not required.
It argues this could be detrimental from a competitive point of view as it could allow market users to "free ride" off others' positions.
The IMA adds market disclosure of short positions could also mislead investors who may assume a stock is being shorted due to a negative view of the company, when this is not always the case.
"Short selling is central to the capital markets and plays an important role in investment strategies and risk management," says IMA chief executive, Richard Saunders.
"It also contributes to market liquidity - critical in today's climate - reduces transaction costs and ensures pricing efficiency. We also agree that there should be disclosure of significant short positions to the regulator in order that it has the information required to allow it to police the markets effectively."
An ambitious objective
'Something completely new'
'Illusion of control'
Reasons to be cheerful
Total investment reaches £9m