Egypt’s FRA accepts EGX proposal to extend short selling period to 6 months
REGULATION WATCH- FRA accepts EGX proposal to extend short selling, settling margin position period to 6 months: The Financial Regulatory Authority (FRA) has approved a proposal from the EGX to extend the period custodians can short shares to six months instead of two, effective today, the bourse said yesterday. The market regulator has also agreed to extend to six months the time limit for traders to settle their margin trading positions. These extensions only apply to securities not included in the list of securities eligible for specialized activities, which the EGX updated yesterday. The EGX also updated its list of authorized brokerages and companies (pdf) whose shares you can short.
Background: The EGX and Misr for Central Clearing, Depository & Registry (MCDR) launched short selling on the bourse in December. Beltone and HC Securities were the first brokerages to complete a short selling transaction. The practice has yet to take off in Egypt, with analysts reporting only dozens of trades and some speculating that brokerages simply don’t know how the short selling system operates.