K-OTC Market Sees Sharp Surge in Trading Volume... Nearly 1 Trillion Won Last Year
Tax Benefits and Non-Preservation Effects Lead to 990.4 Billion KRW Trading Volume in 2019
46.6% Increase Compared to Previous Year
[Asia Economy Reporter Oh Ju-yeon] Due to tax benefits such as capital gains tax exemption for small shareholders and reduction of securities transaction tax, as well as increased investor interest in unlisted companies including Vibozone, the trading volume in Korea's over-the-counter market (K-OTC) surged last year.
On the 8th, the Korea Financial Investment Association announced that the annual trading value of the K-OTC market in 2019 recorded 990.37 billion KRW, a 46.6% increase compared to the previous year (675.5 billion KRW). The average daily trading value was 4.03 billion KRW, up 1.26 billion KRW (45.4%) from the previous year. On the 27th of last month, the daily trading value reached 23.61 billion KRW, setting a new record high.
However, the market capitalization decreased by 220.2 billion KRW from the end of the previous year (14.4914 trillion KRW) to 14.2713 trillion KRW, influenced by the transfer listing of some companies such as Jinus.
The number of companies in the K-OTC market increased by 9 from the previous year to a total of 135 companies, with 30 registered companies and 105 designated companies.
The number of K-OTC companies listing on stock exchanges also increased. A total of three companies, including Webcash, Jinus, and PPI, were listed on the KOSPI and KOSDAQ markets, bringing the total number of listed companies since the market's launch to 12.
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Meanwhile, following the expansion of capital gains tax exemption for small shareholders, trading was mainly formed around small and medium-sized enterprises (SMEs), venture companies, and mid-sized companies, which accounted for 94.9% of the total trading value. SMEs and venture companies traded 801.6 billion KRW, accounting for 80.9% of the total trading value, while mid-sized companies traded 138.7 billion KRW (14.0%).
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