AFTER two weeks of registered short-selling, it has become clear that until the Stamp Duty Ordinance is amended Hong Kong's latest investment instrument will be a non-issue. While the first official report from the stock exchange will not be released until January 28, an official said there has been only three short-selling deals registered. Under the current rules, stock can only be borrowed for 14 days before stamp duty must be paid. This makes it an expensive exercise and deters investors from short-selling as a hedging or arbitrage technique. Stock exchange chairman Charles Lee said he hoped the Legislative Council would pass the amendments by mid-year. There is keen interest in short-selling as nearly 80 investment houses have registered with the exchange. Hong Kong and Japan are the only markets in Asia to offer short-selling. The South Korean Foreign Ministry recently said it would restore short-selling after a three-year suspension. The stock exchange has approved short-selling in 21 stocks, which have market capitalisation of at least $10 billion and a public float of at least $5 billion. Short-selling, which accounts for about 10 per cent of trade in US markets, is a technique used by investors who expect stock prices to fall. They attempt to profit by selling stock they do not already own to an investor in the hope they can buy it at a cheaper price in the market before actually undertaking physical delivery, thus making a profit on the turn.