Term: Uptick Rule

Term: Uptick Rule

The Uptick Rule (also known as the "plus tick rule") is a rule established by the Securities and Exchange Commission (SEC) that requires short sales to be conducted at a higher price than the previous trade. Investors engage in short sales when they expect a securities price to fall. The tactic involves buying high and selling low. While short selling can improve market liquidity and pricing efficiency, it can also be used improperly to drive down the price of a security or to accelerate a market decline. (investopedia)