Taiwan Stock Exchange Tightens Regulations to Calm Market Volatility

Following a Global Market Downturn, Measures are Taken to Curb Short Selling and Stabilize the Taiwan Stock Market

Amidst a global stock market downturn triggered by concerns over the Trump administration's tariffs, the Taiwan stock market experienced a drop at its opening. The Taiwan Stock Exchange announced that 936 stocks experienced a daily price limit down today. According to existing regulations, these stocks will be subject to restrictions on short selling below the previous day's closing price the following day. This measure aims to mitigate the impact of speculative short selling on the stock market and reduce the risk of market volatility caused by panic.

To prevent malicious short selling on the Taiwan stock market today, the Financial Supervisory Commission (FSC) reduced the borrowing-to-sell ratio from 30% to 3% on the 6th. The Taiwan Stock Exchange pointed out that when the overall market experienced significant declines in the past, the value of borrowed securities sold increased significantly compared to the previous day. Therefore, the borrowing-to-sell ratio during trading hours today was adjusted to 3%. Comparing the value of borrowed securities sold on the 2nd, which was NT$10.4 billion, with NT$1.5 billion today, a decrease of 86% compared to the previous trading day, it should effectively curb the selling pressure from short sellers.