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[Alpha Biz=(Chicago) Reporter Paul Lee] The Financial Supervisory Service has begun checking short-selling transactions by Exchange Traded Fund (ETF) liquidity suppliers (LP).
According to the financial investment industry on the 20th, the Financial Supervisory Service has begun trading checks on six large securities firms that serve as ETF liquidity suppliers since the 15th. Mirae Asset Securities, Korea Investment & Securities, NH Investment & Securities, Shinhan Investment & Securities, Meritz Securities, and BNK Investment & Securities are eligible.
Since the 6th of this month, when the ban on short selling was imposed, the purpose of the move is to examine whether the short selling transactions conducted by these securities firms as ETF liquidity suppliers do not go beyond the scope of the law. Recently, there have been persistent suspicions among individual investors that mass public sales may be taking advantage of the exceptionally allowed gaps.
Even when public sales were completely banned when there was an external shock such as COVID-19, market creators and liquidity suppliers were allowed some public sales.
This is because market creators present stocks that are rarely traded, and liquidity suppliers are essential to forming market prices by closely presenting buying and selling prices for ETF, Exchange Traded Securities (ETN), and stock futures and options.
AlphaBIZ 폴 리(hoondork1977@alphabiz.co.kr)
