This may return but one other route to encourage investment in these types of schemes – which definately require a long term stake to maximise benefits and returns – is to market to Self Invest Pension holders as a form of private investor. Getting the volume of interest maybe an obstacle given the size of the SIP market and the difficulty in marketing to such a diverse group, though.

The dividend time period plan would do less to stop day trading than increased stamp duty would.

Equally though ‘some’ day trading is no bad thing as it adds to liquidity.

As for shorting, again the details could be done either way – it would be simple to say that if shares were on loan then the holder lost dividend entitlement.

Again though, some shorting is usual.

Would the time limit on the shareholders register do anything to reduce day trading on price fluctations?

I suppose one other considering is the lending of shares for shorting – would the time-on-register proposal affect this?

S

I’ve argued in the past that the best way to influence behaviour through tax is stamp duty. Call it 5% on all transactions (buying and selling). So a fund manager knows a purchase and sale will cost them 10%. They’ve got to be pretty sure before changing the portfolio.

Another option is say that owners are only entitled to dividends if they’ve been on the shareholders register for at least one year.