Short-Selling Biggest Oil ETF Curbed by SEC Rule After Plunge
- SEC rule applies to any security that falls more than 10%
- USO has plunged over 39% this week amid crude turmoil
Photographer: Daniel Acker/Bloomberg
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Traders looking to bet against the beleaguered United States Oil Fund LP are going to have a harder time of it today.
The $3 billion exchange-traded fund’s staggering 25% plunge Tuesday triggered the U.S. Securities and Exchange Commission’s “alternative uptick rule,” which restricts short selling on a stock that has dropped more than 10% from the previous day’s close. After that point, short sale orders can only happen when the stock is ticking higher, on the so-called “offer” side of the spread, in trader parlance.