London – August 2011: The Alternative Investment Management Association
(AIMA), the global hedge fund association, has responded to the temporary
short selling bans introduced by France, Italy, Belgium and Spain.
AIMA CEO Andrew Baker said: “We do not think these bans will help the
current market situation. Past experience has shown that bans on short selling
do not prevent market falls and indeed can exacerbate volatility. Independent
academic research also supports this conclusion.
“Short-selling is a legitimate market practice which helps capital markets
function effectively. It was only last year that the Committee of European
Securities Regulators, the predecessor to ESMA, recognised in an official
report that ‘legitimate short selling plays an important role in financial
markets. It contributes to efficient price discovery, increases market liquidity,
facilitates hedging and other risk management activities and can possibly help
mitigate market bubbles’.
AIMA also supported a statement by the European Securities and Markets
Authority (ESMA) on market abuse which emphasised that market abuse is
prohibited. Andrew Baker added, “Of course market abuse is illegal and has
always been condemned by our industry. If there is any proof of market abuse
having taken place then the authorities should take appropriate action against
the perpetrators. If there is any suggestion of market abuse, however, then it
may be appropriate to take more targeted action rather than impose blanket
bans of this sort.”
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For media enquiries, please contact Christen Thomson, AIMA’s Director of
Communications. Tel: +44 (0)20 7822 8380; Email:
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About AIMA
As the global hedge fund association, the Alternative Investment Management
Association (AIMA) has over 1,250 corporate members (with over 5,500
individual contacts) worldwide, based in over 40 countries.
Members include hedge fund managers, fund of hedge funds managers, prime
brokers, legal and accounting firms, investors, fund administrators and
Alternative Investment Management Association
independent fund directors. They all benefit from AIMA’s active influence in
policy development, its leadership in industry initiatives, including education
and sound practice manuals and its excellent reputation with regulators
worldwide.
AIMA is a dynamic organisation that reflects its members’ interests and
provides them with a vibrant global network. AIMA is committed to developing
industry skills and education standards and is a co-founder of the Chartered
Alternative Investment Analyst designation (CAIA) – the industry’s first and only
specialised educational standard for alternative investment specialists. For
further information, please visit AIMA’s website, www.aima.org.