Stock price limits and circuit breakers

First Published in The Korea Herald. Starting next month, the Korea Exchange will expand price limits and introduce market-wide circuit breakers that should provide some relief for stock traders and retail investors. Price limits and circuit breakers are used by many stock exchanges and regulators to counter severe price movements in financial markets, and Korea is no exception. Price limits are maximum percentages or values that a security or derivative contract can rise or fall in a trading day. Circuit breakers are trading halts triggered by sharp price movements, and can be imposed on either an individual financial instrument or the market as a whole. They were first adopted by the New York Stock Exchange and other U.S. exchanges in 1988.Circuit breakers had been recommended...

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Inadequate steps to boost foreign investment in Korea

First published in The Korea Herald. Last week, the Korean government announced plans to attract more foreign direct investment by more than 50 percent in three years by easing regulations and focusing support on five sectors, including cosmetics and pharmaceuticals. The Ministry of Trade, Industry and Energy said in a statement that industrial materials, petroleum products and food processing sectors would also be given strong support through regulatory changes. Korea received FDI pledges totaling $19 billion last year, up sharply from $14.5 billion in 2013, and now aims to increase the amount to $30 billion in 2017. Despite the sharp rise in pledges last year, South Korea still ranks low among high-income countries in the accumulated amount of FDI compared to the size of its economy. Moreover,...

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