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Bloomberg
Taiwan’s financial regulator has removed stock short-selling restrictions that were put in place to curb market declines during a turbulent period in the final quarter of 2022.
Taiwan’s Financial Supervisory Commission in October banned shorting stocks at a price lower than the previous close if shares drop more than 3.5% the day before. The ban will be lifted immediately, the FSC said in a statement on Thursday.
The regulator will also ease the limit on the volume of intraday securities lending orders to 30% of the average daily trading volume over the previous 30 trading days, from 10% previously, the statement said. The minimum short-sale margin requirements of securities are lowered to 90% from 120%, reducing the costs for bearish investors, according to the statement. The rules will take effective from Friday.
Taiwan regulators have imposed short selling bans as a tool to stem market losses for at least three times in recent years. Sentiment over Taiwan stocks has recovered this year, with the benchmark Taiex entering a bull market last month, amid optimism of a cyclical
recovery of chipmakers.
The FSC said it will continue to monitor global situation and stock markets, and will respond in a timely manner in case of irrational declines in stocks.