Question

Under the provisions of Regulation SHO, before a security can be "sold short," it must be determined that the security:___________.

A. can be borrowed and delivered by settlement
B. has been traded on an + tick or a 0+ tick
C. is not on the threshold listD. is subject to the short interest reporting rule

Answer 1

Under the provisions of Regulation SHO, before a security can be "sold short," it must be determined that the security:___________.

D. is subject to the short interest reporting rule

Step-by-step explanation:

Under the provisions of Regulation SHO, the SEC rule, otherwise known as FINRA 4560 (“Short-Interest Reporting” or the “Rule”), requires a record of total short positions in all customer and proprietary firm accounts for all equity securities (other than Restricted Equity Securities as defined in Rule 6420) to be maintained by each FINRA member who must regularly report such information to the Security and Exchange Commission." This rule is part of the Regulation SHO, which governs short-sale trading strategies, prevents unethical practices, and applies standards to the behavior and practices of brokers, traders, and investors.