Son Byung-du, Exchange Chairman, "We Will Ensure Legal Operation of Short Selling"

Son Byung-du, Chairman of Korea Exchange (Photo by Korea Exchange)

[Asia Economy Reporter Kum Bo-ryeong] Sohn Byung-doo, Chairman of the Korea Exchange, emphasized that the short-selling system will be operated lawfully this year.

At the '2021 Securities and Derivatives Market Opening Ceremony' held in the lobby of the new building of the Korea Exchange Seoul office on the 4th, Chairman Sohn stated, "We will ensure that a fair capital market based on trust is established."

He said, "As Harvard Professor Robert Putnam mentioned, even with the same human and physical resources, growth rates differ depending on social capital called 'trust.' Without a fair market order and investor trust, healthy growth of the capital market is impossible. The Exchange will devote all efforts to eradicate unfair trading and create a market trusted by investors."

First, plans are in place to significantly strengthen pre-inspections and post-management to ensure the short-selling system operates lawfully. Additionally, an efficient monitoring network will be established to detect new types of unfair trading such as price manipulation using algorithms.

Future growth engines for the post-COVID-19 era will also be actively fostered. Chairman Sohn explained, "We will improve the listing entry system to focus on future growth potential so that innovative and growth companies responsible for future food sources can list more easily. We will also further strengthen a customized support system suitable for each stage of corporate growth, including the introduction of Business Development Companies (BDC)."

He added, "We will improve companies' disclosure capabilities and internal controls to ensure important information is smoothly provided to individual investors who are at an informational disadvantage, and enhance investors' access to information. We also aim to improve the delisting system and procedures to promptly remove marginal companies and support the normalization of companies with recovery potential, thereby enhancing market soundness."

Chairman Sohn stated that to become an innovative exchange, "We will support market participants in reducing trading costs by improving tick size and block trading systems, establish a management system for algorithmic trading, and steadily promote the construction of a next-generation system incorporating advanced IT technology. We will also open a short-term interest rate futures market in line with changes in the financial market environment such as benchmark interest rate improvements."

This content was produced with the assistance of AI translation services.