Fund manager Sceptre Investment Counsel Ltd. has received regulatory approval allowing it to double the share of assets certain of its funds can short from 10% to 20%.

In today’s OSC Bulletin, it was reported that regulators agreed to revoke Sceptre’s existing short selling exemption, which allowed its funds to short up to 10% of assets; and replace it with an exemption that raises the shorting limit to 20% of assets.

The new exemption is subject to certain conditions. The aggregate market value of all securities sold short can not exceed 20% of the net assets of the fund on a daily marked-to-market basis.

In addition, the fund must hold “cash cover” that is at least 150% of the aggregate market value of all securities sold short.

As well, the fund must maintain appropriate internal controls regarding its short sales, among other conditions.

The relief does not apply to funds classified as a money market fund or a short-term income fund.