Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Julius Wong who wrote (168114)	2/4/2021 7:20:10 AM
From: TobagoJack	Read Replies (1) \| Respond to of 218710

I think there might be a problem soon-enough given Message 33180837 , meaning when and not if ... bloomberg.com The Country With the World’s Longest Short-Selling Ban Is Risking a Market Fall Heejin Kim A growing number of fund managers and traders are worried that South Korea’s pandemic-imposed ban on short-selling, the world’s longest-such restriction, has artificially propped up the country’s stock market rally. The decision this week to extend the short-selling ban imposed in March last year to tame pandemic-hit markets until early May will likely backfire, they said. Korea, whose benchmark surged last year and is up 7.5% in 2021, this week bowed to retail investor pressure and extended the ban on the key hedging tool, unsettling institutions. Indonesia will lift a ban this month, while countries including France, which restricted short-selling early last year, only kept restrictions for a few months. The extended short-selling ban “is surprising given that Korea’s in a bull market,” said Nader Naeimi, head of dynamic markets at AMP Capital Investors in Sydney who runs a long-short equity fund. “The aim is to avoid a short squeeze like we have seen in the U.S, but the unintended consequence will be a possible plunge in market liquidity.” Retail investors in the U.S., fueled by Reddit forums, had piled into loss-making stocks like GameStop Corp. in recent weeks, squeezing short-sellers. Seoul-based Jeon Kyung-Dae, chief investment officer for equities at Macquarie Investment Management Korea, said, however, that without short-selling, “bearish bets on overvalued stocks are now being delayed and accumulated.” “That means there will be a short-term shock in Korea equities when the short-selling is available for all stocks,” he added. Traders said that without the benefit of short-selling, they are having to use futures of stocks to hedge their exposure. The pandemic-imposed ban on short-selling was supposed to expire on March 15, a year after it was imposed. Instead, it was extended on Wednesday until May 2, when it will be lifted for the country’s largest stocks. In total, from May 3, 350 blue-chip stocks listed on the Kospi 200 and Kosdaq 150 indexes will be allowed to be sold short, while more than 2,000 stocks in Korea will remain banned. Korea’s retail investors have come to dominate the stock market since short-selling was banned and the pandemic spread: they now account for nearly 70% of total trading value, up from 48% in 2019. They have been vocal about keeping short-selling prohibited, arguing that the practice favored large funds and would also hurt market liquidity. Institutional investors say, however, that restricting the strategy of trading borrowed stocks has achieved the opposite. “We don’t see a lot of evidence that banning short selling improves market liquidity or reduces volatility,” said Vince Lorusso, a Boston-based fund manager at Changebridge Capital who runs an equity long-short exchange-traded fund with quantitative and fundamental research. “To ban short-selling would take away a valuable market tool for price discovery and a range of other things.” Korea’s equity market has continued to surge this year, with gains by stocks like green energy stocks tied to electric car or solar energy. “Populism by Korean politicians” likely drove the prolonged ban, said Macquarie’s Jeon. “It’s regrettable that (the regulator) is being swayed by the public opinion.” Lawmakers face two important by-elections in April and a presidential election next year. Still institutions will be rewarded for their patience come May. Retail investor favorite plays that were once in the sights of short sellers will be opened up to such trades again, including Celltrion Inc., which surged 102% last year. Before it's here, it's on the Bloomberg Terminal. LEARN MORE

To: Julius Wong who wrote (168114)	2/4/2021 7:26:04 AM
From: TobagoJack	Read Replies (1) \| Respond to of 218710

That as and when the Korean market blows up Message 33180833 , and it will, Hedge Fund Korea shall have to liquidate book, and the book is heavy w/ American shares of a certain flavor ... and particularly of one stock bloomberg.com Koreans Buy Tesla, GameStop as Foreign Stock Buying Hits Record Heejin Kim February 2, 2021, 6:00 AM GMT+8 South Korean traders piled into U.S. stocks like GameStop Corp. and Tesla Inc. in January, driving their buying of overseas equities to a record high in January. Korean individual and institutional investors bought a net $5 billion of foreign stocks in January, their most-ever monthly tally since 2011, when the Korea Securities Depository began collecting data. Their positions now include $9.8 billion in Tesla Inc. shares -- the largest for any stock -- as well as about $557 million in GameStop Corp., KSD’s data show. GameStop, an unprofitable videogame retailer, has drawn day traders globally, including from India and China. With U.S. stocks representing some 80% of their holdings, Korean retail investors are “highly exposed” to U.S. market risks, Goldman Sachs senior Asia economist Goohoon Kwon said in a note on Sunday. “With their heavy buying during a global equity rally in late 2020, a 10% market correction for example could put one-third of their holdings in the red,” Kwon wrote. GameStop’s Wild Ride Has Indian Retail Traders Joining In Seeking AlphaSouth Korean retail and institutional investors bought a record amount of foreign shares in January Source: Korea Securities Depository Note: Many of investors who deposit stocks at KSD are retail traders Korea’s retail investors, having buoyed their domestic markets, turned to the U.S. and especially tech stocks like Tesla and Apple Inc. for returns last year. The benchmark Kospi surged 31% in 2020, making the Korean bourse the world’s best performer after that of Nigeria’s. Regulators in Seoul have been warning retail investors, and especially those indulging in “ reckless borrowing” to be cautious about investing overseas. (Updates the value of Koreans’ holding of Tesla and GameStop shares in third paragraph) Before it's here, it's on the Bloomberg Terminal. LEARN MORE Sent from my iPad