The Association of Securities Companies (Asco) has reaffirmed there is no naked short selling on the Thai exchange, while the Securities and Exchange Commission (SEC) asked Asco members to adjust their short sell guidelines based on the SEC's instructions.
Asco president Pichet Sithi-Amnuai said the Stock Exchange of Thailand (SET) has regularly examined short selling in cooperation with Asco, with the bourse confirming there is no naked short selling.
As Prime Minister Srettha Thavisin stated that naked shorting had been detected in the Thai stock market, Mr Pichet said the premier might be referring to previous instances.
"I'm not sure where the prime minister got his information from," he told the Bangkok Post.
"It might be a misunderstanding or a reference to old information because some cases were detected in the past, but only a small number."
Stock market inspections have been conducted and such information is disclosed to the public, said Mr Pichet.
Program trading has been used for a long time in the Thai stock market, he said.
"During good investment conditions or a bullish market, nobody pays attention to it. When the market conditions are bullish, there are calls to investigate short selling, which affects the entire industry," said Mr Pichet.
"Accusations of naked short selling without providing evidence has caused misunderstanding and damaged securities companies."
SEC secretary-general Pornanong Budsaratragoon said the regulator asked Asco members to adjust their short selling guidelines based on a notice from the SEC.
Asco suggested the SEC look into the low commission fees offered by some brokers to ensure a level playing field among players.
SET president Pakorn Peetathawatchai said the bourse continues to investigate naked short selling and will make an announcement if it is detected.
"The Thai stock exchange will not allow naked short selling to take place," said Mr Pakorn.
"If anyone is found using this method, we will punish them severely."