Important Notice: Our web hosting provider recently started charging us for additional visits, which was unexpected. In response, we're seeking donations. Depending on the situation, we may explore different monetization options for our Community and Expert Contributors. It's crucial to provide more returns for their expertise and offer more Expert Validated Answers or AI Validated Answers. Learn more about our hosting issue here.

What is a Tick Test?

0
Posted

What is a Tick Test?

0

Tick tests were a method once employed to determine when circumstances were right for the execution of a short sale. To a great degree, this type of testing method was focused mainly on use within markets based in the United States. The tick test approach was first developed and employed during the decade of the 1930’s, but is now considered obsolete. The concept of a test to help monitor and manage short sales came about after the Stock Market Crash of 1929. It was obvious there needed to be some means of protecting interests in a market situation that was, at that point, not as closely regulated as it is today. Thus, the tick test became the standard means of deciding what type of conditions had to exist before a short sale could take place. Known as Rule 10a-1, the tick test became the regulation to govern this type of trading action. Essentially, the tick test provides for a short sale under two conditions. First, the sale could take place in an uptick situation. That is, when the

Related Questions

Thanksgiving questions

*Sadly, we had to bring back ads too. Hopefully more targeted.