MFA Comments to SEC on Alternative Uptick

MFA submitted a letter to the SEC in response to its request for comments on the alternative uptick rule. Our letter supplements our June 22, 2009 letter on the SEC’s proposed short sale restrictions. MFA opposes the proposed alternative uptick rule that would allow short selling only at a price above the current national best bid. We believe that such a test would operate as a near ban on short selling even in non-declining (neutral) markets, and further, that it would lead to unintended consequences and possible gaming. MFA urges the Commission to not adopt such a price test.