short exempt

Short exempt

Used for listed equity securities. A special trading situation where a short sale is allowed on a minustick. The owners of a convertible trading at parity can sell the equivalent amount of common short on a minus tick, assuming they have the firm intention to convert.

Short Exempt

A short sale exempt from the short sale rule, which was a rule requiring that short sales occur only after upticks or zero plus-ticks. Convertible securities were sometimes short exempt. This is no longer important as the short sale rule is not in effect anymore.

short exempt

A short sale exempt from the rule that short sales must occur on upticks. Short exempts include some arbitrage transactions. Owning a security that will be converted into the common stock that will be sold allows a short exempt sale.
References in periodicals archive ?
The firm was also required to revise its written supervisory procedures (WSPs), which were inadequate to ensure the accurate reporting of short sales and short exempt sales to the FNTRF.