Cite as:

Dion Harmon and Yaneer Bar-Yam, Technical Report on SEC Uptick Rule Proposals, New England Complex Systems Institute Report 2009-04 (April, 2009).


The Securities and Exchange Commission (SEC) has proposed reinstating the “uptick rule” in order to stabilize the stock markets. However, the SEC has made five distinct proposals for comment prior to enacting one of them. These proposals are in two categories --- with or without a circuit breaker condition. Here we show the difference of the effects of enacting these proposals on price movements under short sale attack (bear raids). We use as a test case, the example of Lehman Bros on July 10, 2008. Using a circuit breaker based rule does not prevent rapid price declines.