Short Sale Exemptions

What this video covers

• Why a 10% decline from the prior-day close is not enough by itself, and why the listing market must make a determination and notify the market first
• How the above-the-current-national-best-bid route works for the submitting firm, including the time-of-submission price test, written procedures, and regular surveillance
• The deemed owner exception and its delivery-intent requirement, plus the market maker odd-lot exception and its no-more-than-one-unit-of-trading limit
• How equivalent-security arbitrage, international arbitrage, over-allotment sales, and lay-off sales qualify for short-exempt treatment
• The riskless principal requirements: receive the customer order first, allocate the offsetting transaction within 60 seconds, and maintain time-sequenced records
• How to calculate volume-weighted average price (VWAP), the actively traded security and 20-security basket alternatives, and the mandatory VWAP trade modifier
• The VWAP 10% aggregated pre-opening principal cap and why only the Securities and Exchange Commission (SEC) can grant an exemption