Short Sale Regulations

What this video covers

• The two Regulation SHO short-sale definition branches: a sale of securities the seller does not own, or a sale settled by delivery of securities borrowed by or for the seller
• The six deemed-ownership routes, including title, unconditional purchase contracts, conversion or exchange, exercised options, exercised rights or warrants, and qualifying security futures contracts
• Why an unconditional binding purchase contract counts as ownership before delivery, while holding a convertible security, option, or right alone does not
• How the net long position ceiling works, including the 1,000-share long position minus 800-share short position example that makes 300 shares of a 500-share sale short
• How block positioner and index arbitrage exceptions can deem a broker-dealer to own stock even when it is not net long
• The difference between offsetting positions being created for block positioners and being created and maintained for index arbitrage, plus the 2% New York Stock Exchange (NYSE) Composite Index trigger
• The four requirements for independent trading unit aggregation, including determining the unit's net position at the time of each sale