On April 8, the Securities and Exchange Commission voted unanimously to seek public comment on whether short sale price restrictions or circuit breaker restrictions should be imposed and whether such measures would help promote market stability and restore investor confidence. Specifically, the SEC is seeking comment on five proposals.
Two of the proposals would entail market-wide permanent rules covering all NMS securities (i.e., generally exchange-traded securities).
Three of the proposals would entail a security-specific, temporary rule (“circuit breaker”) covering triggered NMS securities. While the SEC has asked for comments on the “trigger percent,” the proposal mentioned 10% as a starting point.
There will be a 60-day comment period to a allow for comments on the proposals. In particular, the SEC asked for comments on possible exceptions to proposed rules. It should be noted that the initial proposals will not contain a market maker exception.