'Preventing a Second Youngpoong Paper Incident'... Exchange Includes 'Long-term Abnormal Surge' Market Alert

The Korea Exchange (KRX) will introduce a market alert system targeting stocks whose prices have abnormally surged or whose trading patterns have been unhealthy over an extended period.

On the 27th, the KRX Market Surveillance Committee announced plans to introduce a "long-term unhealthy" criterion for stocks that have risen more than 200% in a year and exhibit unhealthy trading patterns, adding this as a new category of investment warning stocks. This is a follow-up measure in response to recent suspected cases of stock price manipulation in the capital market.

The market alert system consists of three stages: "Investment Caution → Investment Warning → Investment Risk." In the past, most unfair trading cases involved short-term sharp price increases, but recently, cases have emerged where prices were driven up over several years to evade surveillance. Previously, the alert system was based on short-term price fluctuations of up to 15 days, but going forward, cases of long-term price increases will also be subject to alerts.

If a stock's price has increased by 200% or more in the past year and the purchase involvement rate, considering the market influence of the top 10 accounts, exceeds a certain level, it will be designated as an investment warning target. However, stocks listed on the KONEX market, newly listed stocks, stocks that have not passed one year since the application date based on the market price reference, and stocks already designated as investment warning stocks under the long-term unhealthy criteria within the last 30 business days are excluded.

A KRX official stated, "The introduction of the long-term unhealthy type this time focuses on addressing new types of unfair trading that attempt to evade existing surveillance by driving prices upward over a long period." He added, "By introducing this new category, we expect to contribute to investor protection by early alerting on stocks with a high likelihood of unfair trading and actively responding to a wider variety of unfair trading types." He further noted, "We will closely monitor market trends and continuously improve and supplement the system to enhance its effectiveness in preventing unfair trading."

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