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Financial Watchdog to Enhance Transparency on Short-sale

June 04, 2012 13:42|July 04, 2012 13:06
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Financial Supervisory Commission (FSC) will revise regulations on short-sales to prevent price manipulation by speculative traders.

At a meeting with reporters on June 4, FSC Chairman Kim Seok-Dong said that his commission will strengthen monitoring of short-sale practices and will strictly supervise the trading of speculative instruments in order to minimize market fluctuations.

“To this end, FSC plans to implement position reporting system for short-sales,” Kim said. Major targets for these measures seem to be ELW and FX margin trading which excessively boosts speculative trading in the capital market.

“It is also required for the government to work out some drastic measures to improve the capital market structure where the weights of individual and foreign investors are excessively high,” Kim said.

Kim noted that the government intends to expand demand in the capital market by introducing super-long-term financial instruments. The super-long financial instruments that absorb money from individual investors will work as an effective financial investment tool that can contribute to positive circulation of money and can be utilized as a tool for individuals to prepare for an aging society.