The global economy is built on a foundation of investor trust. Like it or not, this trust is what keeps the work’s financial markets humming. Beneath this trust lays fundamental economic principles that have influenced trading for decades, and even centuries. An expert in financial market regulations and data analysis, Chinmay Jain, PhD, Assistant Professor in the Faculty of Business and Information Technology, studies which economic rules will positively impact the market. His research helps regulatory bodies formulate rules which make financial markets more attractive to investors.
Dr. Jain’s research also examines the impact of short sellers in the equity markets, and the effect of short selling restrictions placed by regulators in the aftermath of the financial crisis. His most recent work investigates the role of short sellers in the financial market in the after-hours on earnings announcement days.
With a penchant for applied math, Dr. Jain earned his Bachelor of Technology in Industrial Engineering from the India Institute of Technology in Kharagpur, India in 2004. He spent three years as a software engineer with GlobalLogic India in Noida, India, and Qwest Communications Inc., in Bangalore, India, before moving to the United States. The role of rapidly advancing technology in increasing the complexity of financial markets, spurred his interest in earning his Doctorate in Finance from the University of Memphis, in Tennessee in 2012. That same year he received The Financial Review Best Paper Award for his co-authored research paper entitled: Shot Selling: The Impact of SEC Rule 201 of 2010.
Bringing international expertise in understanding market microstructures and trading rules to the UOIT classroom, Dr. Jain motivates his students participate in team challenges including the CFA Institute Research Challenge which promotes best practices in equity research among future analysts.
Industry Expertise (5)
Areas of Expertise (6)
Best Paper Award, The Financial Review (professional)
Awarded for his co-authored paper entitled: Short Selling: The Impact of SEC Rule 201 of 2010.
University of Memphis: PhD, Finance 2012
India Institute of Technology Kharagpur: BTech, Industrial Engineering 2004
Event Appearances (7)
Short Selling Duration and Return Predictability
Eastern Finance Association Annual Meeting Baltimore, Maryland
After-Hours Short Selling on Earnings Announcement Days
2015 Midwest Finance Association Annual Meeting Chicago, Illinois
Does Accounting Conservatism Deter Short Sellers?
2014 Financial Management Association Annual Meeting Nashville, Tennessee
A Comparative Analysis of Short Selling Restrictions
2012 Financial Management Association Annual Meeting Atlanta, Georgia
Dynamics of Market Liquidity and Funding Liquidity During the Crisis, its Resolution, and After the Volcker Rule
2012 Financial Management Annual Meeting Atlanta, Georgia
Short Selling: The Impact of SEC Rule 201 of 2010
Northern Finance Association Conference 2011 Vancouver, British Columbia
Causes and Effects of Demutualization of Financial Exchanges
2011 Midwest Finance Association Annual Meeting Chicago, Illinois
Research Grants (1)
Big Data in Finance
UOIT Undergraduate Program Research Award $4500.00
Awarded to supervise a summer research student's work.
This research examines the determinants of fails-to-deliver in the period before and after the implementation of Rule 203 (elimination of option market maker exception from the locate and close-out requirement) and Rule 204 (t+3 close-out rule) in September 2008.
Despite its sizeable compliance costs, this research shows no clear benefits of SEC Rule 201 in ensuring fair valuations and price stability, promoting higher liquidity and execution quality, or preventing a sudden flash crash or prolonged market crises. Daily and intraday analysis of data both before and after Rule 201 finds that short sellers are naturally more active before the occurrence of negative returns, not after significant price declines.
This chapter provides a detailed historical account of the evolution of short selling regulations and trading practices during both normal and crises periods. Certain aspects of short selling restrictions, such as the uptick rule and limitations on short selling by mutual funds, hamper the price discovery process.
The Securities and Exchange Commission’s new Rule 201 restricts the short selling of stocks after a 10 percent price decline, with the intention of preventing short selling from further driving down stock prices. However, empirical evidence from recent stock price declines suggests the rule is unnecessary.