NH Investment & Securities Reduces CFD Limit to 50 Million KRW

NH Investment & Securities is reducing the limit for over-the-counter derivatives, specifically Contracts for Difference (CFD), from the existing 500 million KRW to 50 million KRW. This move is seen as a response to regulatory improvements following the stock price crash incident triggered by Soci?t? G?n?rale (SG).

According to the financial investment industry on the 19th, NH Investment & Securities will reduce the basic position limit for domestic and overseas stock CFDs from 500 million KRW to 50 million KRW starting from the 17th of next month. This applies to CFD contract registration accounts without a dedicated manager (PB·service staff), regardless of balance status.

If there is no dedicated manager, only liquidation transactions are allowed when the purchase amount of existing positions exceeds 50 million KRW. There will be no forced liquidation for the excess amount. If there is a service staff, the basic CFD position limit remains at the existing 500 million KRW. For new transactions, it is mandatory to register a service staff.

Meanwhile, the Financial Services Commission has decided to suspend new CFD transactions until the end of August, until institutional improvements are put in place. Securities firms that fail to implement the improvements within this period will not be able to conduct new CFD transactions even on the reopening date of September 1.

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