SEC's Aguilar: some short position disclosure OK

By Rachelle Younglai

WASHINGTON (Reuters) - A top U.S. securities regulator on Wednesday advocated some public disclosure of short-selling positions, information which could give a rare glimpse into big money managers' trading strategies.

The U.S. Securities and Exchange Commission will meet as early as May to finalize an interim rule that requires large investors and hedge funds to reveal their short positions to the agency.

"Some public disclosure of short (positions) is appropriate," SEC Commissioner Luis Aguilar told the Reuters Global Financial Regulation Summit. Aguilar, a Democrat, is one of five SEC commissioners who make decisions on federal securities rules.

The interim rule, which expires at the end of July, requires money managers to reveal the number and value of securities sold short. But that information is only disclosed to the agency, not made public.

The SEC imposed a number of interim measures to restrict short selling last autumn when markets were dropping precipitously and there was a fear that rumor-mongering and stock manipulation would decimate Wall Street.

Short sellers, who make bearish bets on stocks, and the hedge fund industry, which employs short selling in investment strategies, said they were unfairly targeted by the SEC's actions.

The SEC said the information it collected would be useful to evaluate if its short-selling measures work as intended in times of financial stress.

Investors who accumulate large, or long, positions in stocks are already required to publicly disclose their stakes 45 days after the end of each quarter. Aguilar said he did not know when the short positions should be disclosed.