Korea ELW crackdown leaves traders unhedged
Dealers are left unable to hedge ELS positions as liquidity dries up in Korea’s warrant market
The latest crackdown by the Financial Services Commission on the Korean equity-linked warrant (ELW) market has had the knock-on effect of sharply reducing hedging options for issuers in their equity-linked securities (ELS) products, according to market participants.
The financial regulator has implemented a series of measures in the last 12 months to tighten control over the ELW market, including mandatory education of retail investors, a minimum deposit of 15 million won (US$13,000) and, on
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