SEC approves short-selling

MANILA, Philippines — The Securities and Exchange Commission (SEC) has approved the Philippine Stock Exchange (PSE)’s plan to introduce short-selling in the market.

In an interview with The STAR, SEC chairperson Emilio Aquino said the regulator agrees with the PSE that short-selling would provide more liquidity in the market.

Both the PSE and SEC are threshing out the details on how to implement the plan.

“Hopefully, we can do it this year. We actually approved that already... It should already be moving,” Aquino said on the sidelines of the inauguration of the PSE Event Hall on Monday.

PSE president and CEO Ramon Monzon said that short-selling, which has been proposed by stock market investors since the 1990s, would encourage big funds to return to the market.

It’s the first step in trying to get foreign investors back into the market, he said.

Short-selling is a trading strategy wherein investors bet on a stock whose price is deemed to fall. It involves an investor borrowing shares and then buying the same number of shares at a lower price.