100 PERCENT MARGINS REVISITED

IT IS FOUND THAT THE IMPOSITION OF THE SPECIAL 100 PERCENT MARGIN REQUIREMENT APPEARS TO IMPEDE THE SUBSEQUENT RELATIVE PRICE PERFORMANCE OF THE STOCKS AFFECTED. THE EFFECT HAS TWO COMPONENTS - A RELATIVE PRICE DROP ON THE IMPOSITION DATE AND A SMALL RELATIVE PRICE INCREASE OVER THE NEXT 25 TRADING DAYS. THESE ADJUSTMENTS LESSENED OVER TIME FOR THE NYSE SAMPLE, SUGGESTING AN ADAPTATION TO THE BAN. THUS, A TENATIVE CONCLUSION IS THAT THE 100 PERCENT MARGIN IMPOSITION HAS AN UNMISTAKABLE IMMEDIATE (THAT IS, ONE DAY) EFFECT ON PRICE PERFORMANCE, BUT SUBSEQUENT INFLUENCE IS LESS CERTAIN. TABLES. CHART. REFERENCES.