[Special Stock] Bonus Share Issuance Scene.. Limit Up for 2 Consecutive Trading Days

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[Asia Economy Reporter Hwang Junho] On the 15th, in the stock market, Jogwang ILI and Silicon Two are recording the upper price limit for two consecutive trading days due to the ex-rights effect of the bonus issue.

As of 9:39 AM on the 15th, Jogwang ILI is trading at 3,605 won, up 29.91% from the previous day. Silicon Two is also up 29.87%, trading at 6,870 won. Both companies hit the upper price limit the previous day as well.

This is analyzed to be due to the optical illusion effect caused by the ex-rights of the bonus issue. Ex-rights means that the right to subscribe to new shares or to receive new shares free or paid is not granted to existing shareholders. On the ex-rights day, the standard price of the stock is artificially lowered according to certain criteria to maintain fairness between existing and new shareholders, which creates a temporary effect of the stock price appearing cheaper.

Jogwang ILI and Silicon Two experienced ex-rights due to the bonus issue on the previous day, forming new standard prices of 2,135 won for Jogwang ILI and 4,075 won for Silicon Two. Previously, both companies had decided on a bonus issue allocating 5 new shares per 1 existing share.

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