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April 29, 2017

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Long day trading to be started at month's end

TAIPEI, Taiwan -- The Taiwan Stock Exchange (TWSE, 台灣證交所) on Monday announced that further deregulated day trading will roll out on June 30, after which investors will be allowed to engage in long (sell-first) day trading of 200 local stocks, signifying the further relaxation of Taiwan's day trading.

In October 2013, the Financial Supervisory Commission announced that it will permit short (buy-first) day trading as a means to further refine Taiwan's securities trading system, provide investors with an additional hedging channel and further invigorate Taiwan's equity market.

According to TWSE, both long and short day trading will be applied to shares of the 200 companies that collectively comprise the Taiwan 50, Taiwan Mid-Cap 100, and GreTai 50 indices.

TWSE added that this deregulatory measure provides a counterbalance to the short day trading system, and affords investors an additional trading strategy to choose from, thus building on Taiwan's securities trading mechanisms, attracting more participants into the local capital market and spurring greater momentum on the Taiwanese stock market.

The difference between long and short day trading is that when a day trader is in a long trade, he has entered a trade by buying a contract of shares in the hope that the price will go up while a day trader in a short trade expects the share price to go down.

Foreign Investors' Buy-in Intensifies

TWSE yesterday also announced that the securities net overbought position by foreign investors was NT$19.67 billion during the week of Jun. 9-13. This represented the difference between NT$103.61 billion securities bought and NT$83.94 billion securities sold.

The net overbought value saw a substantial increase of 665 percent from NT$19.67 billion of the previous week.

The accumulated net overbought position by foreign investors, during the period year to June 13 was NT$ 224.62 billion. This represented the difference between NT$2.43 trillion securities bought and NT$2.21 trillion securities sold.

The market capitalization of the shareholdings of foreign investors was NT$9.68 trillion as of June 13, or 37 percent of the total market capitalization. This is higher by NT$66.34 billion than that of a week ago.

The three securities that reported the highest overbought positions, in terms of thousand shares, by foreign investors during the week of June 9-13 were United Microelectronics Corp. (聯華電子) 47,542, Yuanta Financial Holding Co. (元大金控) 33,383, and Taishin Financial Holding Co. (台新金控) 29,908, respectively.

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