While UK regulation of hedge funds has much to commend itself in comparison with other financial centres, notably the US, the specific approaches taken to short selling – specifically the four-month ban and the subsequent proposals on disclosure – do nothing to enhance our credentials for global leadership. On the contrary.

The one great benefit of the UK’s ban on short selling financial stocks, which ended on January 16, is that it provided the perfect laboratory in which to assess the policy’s merits. The conclusion is unequivocal – it was a mistake.