"Instead of curtailing price swings, (position limits) could exacerbate them," he warns.

In a December 2010 paper, Bernard Lee. Shih-fen Cheng and Annie Koh of Singapore Management University, look back at the so-called equity market flash crash of the previous May 6, with an eye toward which controls, if any, would have prevented the brief but unusual drop that saw the Dow Jones Industrial Average tank 9% at one point.

Looking at position limits, Lee, Cheng and Koh ran their model on the assumption that position limits had been imposed, and found that the "markets in this simulation experienced a significant increase in violent 'up and down' shocks."

The question the authors pose to regulators is a salient one: "If certain prescriptive measures such as position limits have a low probability of meeting its policy objectives on a day like May 6, will there be any other more effective counter measures without unintended consequences?