CARESS Working-Paper, University of Pennsylvania, Ph, n° 95-01 This paper analyzes an incomplete financial markets model with pricetaking utility-maximizing financial innovators and no-short sales restrictions. It is shown that, given the indeterminacy of the no arbitrage price conjecture of innovators, financial markets can remain incomplete in equilibrium. As a consequence, real indeterminacy of degree at least equal to int (S/2)(S-(S/2)) results, where S is the number of spots in the future. The dimension of innovators' beliefs giving rise to I newly introduced financial assets is I(S-I), with an equal degree of real indeterminacy.