Zero Uptick

DEFINITION of 'Zero Uptick'

A transaction executed at the same price as the trade immediately preceding it, but at a price higher than the transaction before that. For example, if shares are bought and sold at $47, followed by $48 and $48, the last trade at $48 is considered to be a zero uptick. This distinction can be important for short sellers trying to avoid shorting an ascending stock. Also known as a zero-plus tick.

BREAKING DOWN 'Zero Uptick'

The technique of shorting on a zero uptick is not applicable to all investment markets, due to various rules and regulations prohibiting or restricting such transactions. The forex market, which has limited restrictions on shorting, is among the markets in which the technique is more popular.

RELATED TERMS
  1. Zero Plus Tick

    A security trade that is executed at the same price as the preceding ...
  2. Uptick

    A transaction for a financial instrument that occurs at a higher ...
  3. Tick Test Rules

    A now defunct rule that placed restrictions on when a short sale ...
  4. Short-Sale Rule

    A Securities and Exchange Commission (SEC) trading regulation ...
  5. Plus Tick

    A price designation referring to the trading of a security at ...
  6. Short Exempt

    A short sale order in which the uptick rule doesn't apply to ...
Related Articles
  1. Trading

    The Uptick Rule: Does It Keep Bear Markets Ticking?

    This rule prevents traders from driving stocks down, but its effect on market volatility is debatable.
  2. Trading

    The Uptick Rule Debate

    This rule was deemed ineffective and repealed in 2007, but critics argue it protects the market from bear raids.
  3. Trading

    Why Is Short Selling Legal? A Brief History

    Short selling -- selling borrowed stock in hopes the price goes down -- was unregulated until the Great Depression.
  4. Trading

    Why Is Short Selling Legal? A Brief History

    In the U.S., before a short sale can occur, broker/dealers must have reasonable grounds to believe that shares can be borrowed and delivered on time.
  5. Investing

    The Basics Of Short Selling

    Short sellers enable the markets to function smoothly by providing liquidity, and also serve as a restraining influence on investors’ over-exuberance.
  6. Investing

    Short Selling: Why Short?

    Generally, the two main reasons to short are to either speculate or to hedge. When you speculate, you are watching for fluctuations in the market in order to quickly make a big profit off of ...
  7. Investing

    Short Selling: Ethics And The Role Of Short Selling

    It's safe to say that short sellers aren't the most popular people on Wall Street. Many investors see short selling as "un-American" and "betting against the home team" because these sellers ...
  8. Investing

    What Are Transaction Costs?

    Transaction costs are expenses incurred from buying or selling securities.
  9. Trading

    Rules and Strategies For Profitable Short Selling

    Short sales work well in bull and bear markets but strict entry and risk management rules are required to overcome the threat of short squeezes.
  10. Markets

    Short Sales For Market Downturns

    This strategy can help in market downturns, but it's not for inexperienced traders.
RELATED FAQS
  1. What kinds of restrictions does the SEC put on short selling?

    Learn about the rules and regulations on short selling enforced by the U.S. Securities and Exchange Commission, or SEC, including ... Read Answer >>
  2. Why is the Uptick Volume important for traders and analysts?

    Find out why technical analysts and traders keep track of uptick volume to better assess the momentum of a stock's price ... Read Answer >>
  3. What is a common strategy traders implement when using the Uptick Volume?

    Learn how traders use uptick and downtick volume with VWAP cross to identify trends and momentum and identify points of big ... Read Answer >>
  4. What is the Uptick Volume formula and how is it calculated?

    Learn more about uptick volume, a measurement of the number of trades that take place during a time when an asset's price ... Read Answer >>
  5. What are the best technical indicators to complement the Uptick Volume?

    See how uptick volume can be used to help confirm price trends from nearly every trend-following indicator, especially when ... Read Answer >>
  6. Can you short sell ETFs?

    ETFs (an acronym for exchange-traded funds) are treated like stock on exchanges; as such, they are also allowed to be sold ... Read Answer >>
Hot Definitions
  1. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  2. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  3. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  4. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  5. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  6. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
Trading Center