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You could stipulate whatever you wanted, but there is nothing special about that threshold in particular. I fully agree that derivatives can create all sort of
by kgwgk 6y ago
You could stipulate whatever you wanted, but there is nothing special about that threshold in particular.
I fully agree that derivatives can create all sort of problems in many cases, including when the nominal amount of the positions is much higher than the actual amount of the underlying.
- FabHK 6y agoAgreed fully. The 2x long, -1 short limit is just a neat, natural limit that one could discuss, and might be easier to enforce than other (similarly arbitrary) limits.
- kgwgk 6y agoI'm not against that, but it's not trivial to implement either.
- FabHK 6y agoWould require to set up a central registry or so, yeah. (Or finally a use case for blockchain!!!1!!! :-) Not sure it would be worth it, I think historically excessive shorting has rarely been a problem, except for a few colourful episodes like these.