The VOC was established in 1602 when it was granted a 21-year monopoly by the Dutch government to trade with Asia. It was the first multinational corporation in the world, and it was the first to issue stocks.

Le Maire invested 85,000 guilders in the company in 1602, but had become dissatisfied by 1609. The VOC had not paid dividends and stock-holders were not being given information about its financial results.

Le Maire decided to dispose of his VOC shares – and sell even more than he owned. Paul Frentrop, head of asset management corporate governance at the largest Dutch pension fund ABP, who has researched corporate governance in the period from 1602 to 2002, calls Le Maire the first hedge fund in history.

Exchange regulation

Le Maire expected international competition to depreciate the VOC stock and he spread rumours to put further pressure on the value. He introduced a strategy not unlike the one companies like Belgium-Dutch financial services group Fortis seem to be the victim of today.

Dignitaries were outraged at Le Maire's practices and issued the first stock exchange regulation. Short selling was restricted in Holland in 1609. A ban that was not lifted until years later.

And now, centuries later, the Dutch finance minister Wouter Bos has announced a new ban on naked short selling. The ban was agreed on by the countries of the Euronext stock exchange group on Sunday.

Short sellers sell stocks they have borrowed, hoping their value will drop. Naked short selling is a similar form of speculation but the stocks are not even borrowed meaning they are unsecured.