The FSC announced that stock short selling will resume for KOSPI 200 and KOSDAQ 150 stocks beginning on May 3 as the authorities completed making necessary improvements to the system.
The improvements made to the short selling system include the following.
a) Introduction of stronger monetary sanctions and criminal penalties on naked short selling and other illegal short sale activities (in effect from April 6)
b) Establishment of illegal short selling detection system (in place from March 16)
c) Expansion of short selling access and opportunities for retail investors (KRW2.4 trillion in stock lending becoming available compared with KRW40 billion at the end of 2019)
d) Overhaul of the market maker system to reduce market makers’ share of short selling volume
With the partial resumption of short selling, the authorities will closely monitor markets to expand the availability of statistical information on short selling activities and to maintain a quick response system. Statistical data on short selling can be accessed at the Korea Exchange’s website (http://data.krx.co.kr).
* Please refer to the attached PDF for details.