[ad_1]
![Distributors are working in Hana Bank's trading room in Jung-gu, Seoul, on the morning of the 4th, when the KOSPI began to slightly decline. [사진출처=연합]](https://news.google.com/news/photo/202102/68504_40383_1921.jpg)
The short sale measures, which were scheduled to resume on March 15, have again been suspended.
Shortly after the re-election on April 7, the resumption of short selling occurred, criticizing whether the encouragement of some politicians considering the vote of the ‘Ant Donghak’ was working. The short selling ban lasts for 45 days.
The financial authorities have decided to extend the ban on short selling again. The Financial Services Commission held a special meeting the day before and decided to resume short selling on May 3, after the local elections are over. However, the policy is to allow short selling only to large stocks like KOSPI 200 and KOSDAQ 150, rather than resuming full short selling.
All other stocks remain prohibited without a separate deadline.
Previously, as the volatility of the domestic capital market increased due to the new coronavirus infection (Corona 19), the share price plummeted and a ban on short selling was introduced to revitalize the stock market. Initially, it was announced temporarily for six months, but voices in and out of the market were growing each time before reopening time, so the ban period in September this year was extended until March 15 this year. With this renewal, the restriction on short sale transactions is expected to continue for one year and two months.
The Financial Services Commission also introduced some inconvenient measures, such as expanding the access rights of individual investors who have fiercely opposed short selling, while setting the resumption date for short selling of major stocks.
Short selling is an investment technique that borrows and sells stocks when the stock price is expected to decline, and then buys and repays stocks when the stock price drops.
Although it has the net function of calming the price of overvalued stocks and avoiding losses in a bear market, our short selling system is unilaterally advantageous for foreigners and institutional investors who have excellent financial and information powers, as it is called a reduced playground. ‘. The investment limits allowed for individual investors are also limited and the margins are applied differentially.
It was also criticized for not having a system to filter out illegal, debt-free short sales in real time, which have a high risk of default.
The short sale, which will resume from May 3, will only allow 350 stocks that make up the KOSPI 300 and KOSDAQ 150 indices. Since only large stocks with large market caps and large trading volumes are allowed, sensitivity to Short selling is relatively low compared to small stocks, so it is difficult to influence the stock price with a large number of stocks.
In the market, a consensus formed that the stock index was skyrocketing, with the KOSPI surpassing the 3000 line this year, and the need to resume short selling as investments rush rapidly into the stock market. .
The Financial Services Commission appears to have found a realistic compromise between the determination that the resumption of short selling, which is a global standard, is unavoidable, and pressure from individual investors to strongly oppose the resumption of short selling in short due to concerns about a drop in share prices.
However, the backlash is increasing as stocks such as Celltrion and HLB, which have a large balance of short selling, which individual investors have designated as an “anti-shorting movement”, are included in the selling resume at May short.
“(This decision to extend short selling) is an election measure,” said Jeong Eui-jeong, CEO of Han Too-yeon.
The Donghak ants argue that if the short sale of large stocks is allowed, the index crash is a matter of time, and that the fall of other stocks is also inevitable, as it is linked to indexed products.
The market predicts that the market will be less shocked as the period for the short selling ban is not long and short selling resumes mainly for large stocks as the market accepts it as a neutral topic.
The current economy
Copyright © Today Economic Daily Unauthorized reproduction and redistribution prohibited.
[ad_2]
