▲ Deputy Prime Minister and Minister of Economy and Finance Koo Yoon-cheol (center) and other attendees pose for a photo ahead of an emergency market situation inspection meeting held at the Government Complex-Seoul on the 29th. From left: Ha Joon-kyung, Senior Presidential Secretary for Economic Growth; Lee Eok-won, Chairman of the Financial Services Commission; Deputy Prime Minister Koo; Bank of Korea Governor Shin Hyun-song; and Lee Chan-jin, Governor of the Financial Supervisory Service.
Economic and financial authorities are stepping in to manage the total volume of single-stock leveraged exchange-traded funds (ETFs), which have been pointed out as a key driver of stock market volatility.
Measures such as setting individual investment limits are being pursued.
Deputy Prime Minister and Minister of Economy and Finance Koo Yoon-cheol announced these countermeasures after holding an emergency market situation inspection meeting with related agencies at the Government Complex-Seoul today (the 29th).
In addition to the so-called "F4"—consisting of Deputy Prime Minister Koo, Bank of Korea Governor Shin Hyun-song, Financial Services Commission Chairman Lee Eok-won, and Financial Supervisory Service Governor Lee Chan-jin—Senior Presidential Secretary for Economic Growth Ha Joon-kyung also attended the meeting.
Authorities suggested capping individual investments within 20 percent of total investment amounts as an example of setting individual investment limits.
Taking into account cases of variable leverage multiples such as those in Hong Kong, authorities also decided to establish legal grounds to take market stabilization measures in emergency situations.
To curb excessive trading behavior, they decided to increase transaction cost burdens by applying measures such as the excessive quote surcharge currently operated in the futures market.
In addition to the current mandatory preliminary education, simulated trading will be introduced to help investors make prudent decisions.
These measures will be implemented immediately.
Previously, authorities decided to raise the basic deposit required for investing in single-stock leverage products from 10 million won to 30 million won.
The strengthened basic deposit requirement is scheduled to take effect the day after tomorrow (the 31st).
(Photo: Yonhap News)
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