Shares subject to the US shorting ban in September suffered a "marked degradation" in liquidity when short sellers were limited in their activities, according to a leading US academic, who has added further weight to the argument that such initiatives have failed to halt financial stocks' slide.

Charles Jones, professor of finance and economics at Columbia School of Business, said stock prices fell by about 33% during the Securities & Exchange Commission's three-week ban on shorting shares of 1066 financial companies. However, he added that stocks affected by the ban fell further than the general market by October 8, when the ban was rescinded.