Who says air restrictions don’t work? Taiwan Cement, Cathay Pacific… 17 stock buy orders will emerge! FCA’s trump card must be paid “sooner or later” – Today Weekly

It was only when the stock market was in a panic and investors were panicking and selling stocks that the Financial Supervisory Commission finally acted. The focus of this shot is on the “air limit order”. Two main measures are proposed: (1) reducing the number of lending orders and selling internal securities from 30% to 20% of the daily average volume in the previous 30 days; (2) increase the securities lending margin ratio from 90% to 100%.

Because the proportion of this reduction is not large, many investment experts and market leaders have criticized the implementation of this air restriction order, believing that it will not be effective. But is it really so?

According to the measures taken by the Financial Regulatory Commission this time, regarding the limit on the number of coupons sold by legal persons, taking TSMC (2330) as an example, the average volume in the last 30 trading days is 28,783. the number of tickets that can be sold by lending coupons is 8634, if we look at the upper limit of 20%, the number of tickets that can be sold by lending coupons is 5756.

Taking 9/30 of TSMC’s trading volume of 58,366 sheets, it only accounts for 9.8% and less than 10%, therefore, it is far-fetched to say that the reason for TSMC’s decline is that foreign investors have borrow bonds to sell. Therefore, it is indeed relatively ineffective to reduce the number of lending orders and sell securities within a day from 30% to 20% of the daily average of the first 30 days.

The tail of the policy should not be overlooked

However, the real killer move is yet to come.According to past experience, when the FSC targets the “bond lending market”, it is often accompanied by the supporting measures of “bond repayment need”. That is, the financial institution that lends stocks will be required to get the loan coupons back. At this time, if the foreign capital has already sold the borrowed securities, it must buy back the stocks from the market, forming another type of “recovery from securities lending”.

It’s just that stock lending is the personal behavior of an investment institution, so the Financial Supervisory Commission cannot use an executive order to ask the issuer to take back the borrowed stocks, only moral suasion.

However, as long as the competent authorities have a clear approach, I assess that it is easy for these life insurance companies that lent the bonds to find out what they like, and they will follow up and ask foreign investors to repay the bonds. Currently borrowing bonds to sell stocks with a large balance, please refer to Appendix 1.

Table 1. Equity shares with a balance of more than 100,000 sold through loan coupons

Attached table 1 is the weighted stocks with a balance of more than 100,000 sold through loan coupons. There are 5 electronic stocks, and the benchmark stock is UMC (2303). Financial stocks have 6 levels. I assess Cathay Pacific Gold (2882) and Fubon Gold (2881) as indicators because their lending and selling balances have reached a new swing high. Traditional stocks also have 6 levels. I judge TCC (1101) and Sinosteel (2002) to be the benchmark stocks, because their balance of lending and selling bonds also reached new highs recently.

These individual stocks with a balance of more than 100,000 are sold by credit, if notified to repay the credit, the borrower is then bound to buy back the individual shares from the market, forming another multi-party force in addition to investment Buy investment friends It can be judged from the changes in the amount of foreign investment and trading to determine if these pressure stocks sold by loans have bottomed out.

Short first, then a short squeeze

Regarding the second policy: the margin ratio of securities lending has increased from 90% to 100%. For investors who insist on shorting, there is not much difference, and there has been 120% experience in the past, so there will However, to avoid causing too much of a rebound, the gold tube will only increase by a small 10% .

But do not underestimate this stamina, because there is more profit, and investors can tolerate a lot of room to be rolled, but after they are recovered, the amount will be very large, leading to an embarrassing situation where’ n securities lending must do. The central market’s funding balance has been further reduced to less than 180 billion, and the amount of securities that can be borrowed will be further reduced in the future. In other words, it is not easy to increase the amount of short orders to spread, so this move can be said to be the financial regulatory commission. Therefore, companies whose future securities lending maintenance rate is below 130% should pay attention to the possibility of being called for margin at any time.

Maybe I’m an old-fashioned person. I remember my elders used to tell me that “people don’t fight against officials. “Now that the policy aspect has become so clear, I think those short selling investment friends might consider taking to it soon as possible. Finally, I wish everyone a successful investment!

About the Author_Chen Weitai

Involved in the financial and securities industry for more than 17 years, a qualified securities analyst, currently the chief investment officer of Zhongying Wealth, CMoney Quanyao Financial Consultant, Financial Editor, and lecturer of the Securities Foundation and Zhongzheng Community University, Today Weekly, Yahoo Wealth Management Column, Fortune Net Business Week special writer.

The investment mindset focuses first on the long-short cycle of the general economy, and combines fundamental stock selection with technical operations; it is believed that “choosing the opportunity to enter the market” is the profit method of investing in the stock market. Currently, there are 2 books: “Trust me, you can’t make enough money”, “Taiwan stock shareholders calendar”.

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