The Philippine Stock Exchange (PSE) will finally launch its long-awaited short-selling program on Oct. 23 as it has already been given all the necessary regulatory approvals.

Speaking during the Forum on Legislative Reforms for the Philippine Capital Market, PSE President and CEO Ramon S. Monzon said the bourse had already conducted several webinars since last month to prepare market participants for the launch of the short-selling program.

“We are scheduled to conduct a webinar for retail investors on October 6 on some salient features of our short-selling program,” he said adding that they will also feature eligible stocks such as those included in the PSE index, Midcap index, Dividend Yield index, and exchange-traded funds.

Just last Monday, the PSE made its Guidelines for Short Selling Transactions effective after regulators approved critical components of securities borrowing and lending (SBL).

The bourse noted that, “short selling can only function if an SBL program is in place.”

Short selling is the practice of betting on the decline of a stock’s price in order to make a profit.

Here, an investor borrows stock to sell with the aim of buying it back when the price goes down so he can return it to the borrower on a determined date with the hope of pocketing a profit.

The PSE announced SEC’s approval of offshore collateral for SBL in May 2023 while the Bureau of Internal Revenue (BIR) accepted the filing and registration of the Global Master Securities Lending Agreement (GMSLA) in September 2023.

“We are grateful to the SEC and BIR for their approvals on important regulatory aspects of SBL and short selling. This development brings us a step closer to the full adoption and implementation of these much-awaited programs,” said Monzon.

The circular on the Regulatory Framework for Securities Borrowing and Lending and Short Selling Transactions is published on the announcements section of the PSE website.