Die Arbeit befasst sich mit den Auswirkungen verschiedener Leerverkaufsbeschränkungen auf Liquidität, Markt Qualität und Informationsgehalt von Leerverkäufen. Basierend auf einer Paper von Kolasinski et al. wird zunächst in die Thematik eingeführt bevor im Anschluss die zentralen Begriffe definiert und in den Kontext eingeordnet werden. Abschließend werden einige von Kolasinki et al. aufgestellte Thesen logisch hergeleitet und deren empirische Überprüfung beschrieben.
Inhaltsverzeichnis (Table of Contents)
- 1. Introduction
- 2. Short selling and its role on international stock markets
- 2.1 General definition of short selling
- 2.2 Influence on liquidity and market quality
- 2.3 Revealing private information
- 3. The short selling ban
- 3.1 Political perspective during the financial crisis
- 3.2 Approved short selling restrictions by SEC in 2008
- 3.2.1 The emergency order
- 3.2.2 Impact on liquidity and market quality
- 4. The empirical analysis of Kolasinski et al. (2009)
- 4.1 Description of the used models
- 4.2 Discussion of the results
- 5. Conclusion
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This term paper examines the practice of short selling, its role in global stock markets, and the impact of short selling restrictions on liquidity, market quality, and information content. It analyzes the effects of specific short-selling restrictions implemented during the 2008 financial crisis, using the empirical study of Kolasinski et al. (2009) as a framework.
- The definition and mechanics of short selling.
- The impact of short selling on market liquidity and quality.
- The role of short selling in revealing private information.
- The effects of short selling restrictions on market dynamics.
- Analysis of empirical data related to short selling bans and their consequences.
Zusammenfassung der Kapitel (Chapter Summaries)
1. Introduction: This introductory chapter sets the stage by discussing the decline in trust in the financial system following the 2007-2008 financial crisis. It highlights the controversial role of short selling, particularly in the context of the increased refinancing costs for PIIGS states. The chapter introduces the term paper's objective: to analyze short selling, its functions in global stock markets, and the impact of restrictions on liquidity, market quality, and information content. It outlines the structure of the paper, previewing the subsequent chapters' focus on short selling restrictions and their empirical analysis.
2. Short selling and its role on international stock markets: This chapter provides a detailed explanation of short selling, contrasting it with traditional long investments. It describes the mechanics of short selling, including borrowing fees and the inherent risks. The chapter discusses the role of short selling in hedging strategies, particularly those employed by hedge funds. It also introduces the concept of "naked" short selling, highlighting its higher risk profile. The chapter then lays the groundwork for the subsequent sections by exploring short selling's influence on market liquidity and quality, emphasizing its contribution to market efficiency and the speed of price adjustments to new information.
3. The short selling ban: This chapter delves into the political context surrounding short selling during the 2008 financial crisis. It examines two specific short selling restrictions—the "Emergency Order" and the "Short Selling Ban"—implemented by the SEC. The analysis focuses on the impact of these restrictions on market liquidity, market quality, and the information content of short sales. This section builds upon the theoretical framework established in the previous chapters and prepares the ground for the empirical analysis presented in the next chapter. The chapter sets the stage for the detailed empirical study by highlighting the key areas of investigation and the anticipated results.
4. The empirical analysis of Kolasinski et al. (2009): This chapter presents a summary and discussion of the empirical study by Kolasinski et al. (2009). It describes the models used in the study to analyze the impact of short selling restrictions and details the findings regarding liquidity, market quality, and information content. The chapter thoroughly explains how the empirical research supports or refutes the hypotheses that were formed earlier in the paper. The methodology and the key results of this analysis are presented, creating a solid basis for the concluding remarks in the final chapter (which is excluded from this preview).
Schlüsselwörter (Keywords)
Short selling, market liquidity, market quality, information content, short selling restrictions, financial crisis, empirical analysis, hedge funds, risk management, regulatory intervention.
Frequently Asked Questions: A Comprehensive Language Preview on Short Selling and its Regulation
What is the main topic of this paper?
This paper examines the practice of short selling, its role in global stock markets, and the impact of short selling restrictions on market liquidity, quality, and information content. It focuses specifically on the effects of short-selling restrictions implemented during the 2008 financial crisis, utilizing the empirical study of Kolasinski et al. (2009).
What are the key themes explored in this paper?
Key themes include the definition and mechanics of short selling; its impact on market liquidity and quality; its role in revealing private information; the effects of short selling restrictions on market dynamics; and an analysis of empirical data related to short selling bans and their consequences.
What is short selling, and how does it work?
The paper provides a detailed explanation of short selling, contrasting it with traditional long investments. It describes the mechanics, including borrowing fees and inherent risks, and explores its role in hedging strategies, particularly those used by hedge funds. The concept of "naked" short selling and its higher risk profile is also discussed.
What was the impact of the 2008 financial crisis on short selling regulations?
The paper delves into the political context surrounding short selling during the 2008 financial crisis. It examines specific short selling restrictions implemented by the SEC, analyzing their impact on market liquidity, market quality, and the information content of short sales.
What empirical study is used in this paper, and what are its findings?
The paper summarizes and discusses the empirical study by Kolasinski et al. (2009), which analyzed the impact of short selling restrictions on liquidity, market quality, and information content. The chapter details the models used and the findings, explaining how the research supports or refutes hypotheses formed earlier in the paper.
What is the overall conclusion of the paper (as previewed)?
While the full conclusion is not included in this preview, the paper sets the stage for concluding remarks by presenting a detailed analysis of short selling, its impact on markets, and the consequences of regulatory interventions during the 2008 financial crisis based on the empirical evidence presented.
What are the key words associated with this paper?
Key words include: Short selling, market liquidity, market quality, information content, short selling restrictions, financial crisis, empirical analysis, hedge funds, risk management, regulatory intervention.
What is covered in each chapter of the paper (as previewed)?
The preview provides chapter summaries outlining the content of each chapter: Introduction, Short selling and its role on international stock markets, The short selling ban, and The empirical analysis of Kolasinski et al. (2009). Each summary gives a brief overview of the topics and analyses discussed within each chapter.
- Citation du texte
- Christian Fleischer (Auteur), 2011, Impact of diverse short selling restrictions on liquidity, market quality and information content of short sales, Munich, GRIN Verlag, https://www.grin.com/document/177307
