In an interview last week, the chief executive of Malaysian stock exchange, Bursa Malaysia revealed that a seven year ban on short selling may soon be ended.
According to Bloomberg, Yusli Mohamed Yusoff explained that the move is being considered in order to increase trading in the Malaysian market, and to attract more overseas investment in Malaysian stocks.
Short selling, in which investors sell borrowed shares in the hope of buying them back later at a lower price, was banned in 1997 during the Asian financial crisis when the country's benchmark stock index dropped 52%, allegedly as a result of speculation.
According to Mr Yusli, regulatory approval is currently being sought for a lifting of the ban. However, Bloomberg reported that he declined to comment on the proposed timeframe for such a move.
Bursa Malaysia unveiled plans late last year to sell 166 million shares in an initial public offering scheduled for March.
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