Short-selling rules a "knee-jerk" reaction to rights issues

Managers agreed with the intentions of the new regime and that there was a requirement to protect a company's ability to raise cash through a rights issue. However, most were concerned that this was simply a knee-jerk reaction to recent events. Justin Urquhart Stewart, marketing director at Seven Investment Management, said: "I can see what the FSA was trying to achieve but it doesn't really show a full understanding of how markets work. Short positions can still be taken using contracts for differences or spread betting or other covert ways. This was a knee-jerk reaction to attempt to g...