The Journal of Psychology and Financial Markets, 2000, Vol. 1, No. 1, 24–48 by Gunduz Caginalp, David Porter, and Vernon L. Smith.
The authors concluded that
- Futures markets, dividend certainty, and low liquidity tend to dampen the bubble
- Margin buying and limit price change rules tend to exacerbate the bubble
- All other treatments examined (e.g. short-selling, capital gains taxes, brokerage fees, and call markets) were neutral in their effect on the bubble
HKEx Announces Plans to Suspend the Tick Rule in its Securities Market (Aug 3, 2007)
Hong Kong Exchanges and Clearing Limited (HKEx) announced today (Friday) that its securities market's tick rule will be suspended in the fourth quarter of this year, subject to the approval of the Securities and Futures Commission (SFC).
The tick rule bars short sales below the best current ask price. It constrains trading activities and thus undermines market efficiency and price discovery. Related short selling restrictions require that a short selling transaction must be automatically struck through the electronic trading system, AMS/3, during the Continuous Trading Session.
