Mirae Asset Securities is adjusting its margin maintenance ratio in response to a regulatory measure aimed at stabilizing the stock market.
According to the financial investment industry on November 6, Mirae Asset Securities will lower its margin maintenance ratio from the current 140% to 130%, effective November 9.
This change means that as long as the maintenance ratio remains above 130%, investors' held stocks will not be subject to forced liquidation.
Previously, KB Securities announced it would also temporarily reduce its margin maintenance ratio from 140% to 130% from November 9 to December 11. With both Mirae Asset and KB Securities proactively lowering their ratios, other major brokerage firms are expected to review detailed guidelines and risk management procedures over the weekend to announce similar measures.
However, brokerage firms have cautioned that the criteria for calculating margin shortfalls and the procedures for forced liquidation will remain unchanged. Therefore, if stock prices drop further and the maintenance ratio falls below 130%, forced liquidation may still occur, urging investors to remain vigilant.
This series of actions by brokerage firms follows emergency market stabilization measures announced by financial authorities. On the same day, the Financial Services Commission and the Financial Supervisory Service held an 'Emergency Market Situation Review Meeting' chaired by Deputy Prime Minister and Minister of Economy and Finance Lee Hyung-il, deciding to exempt brokerage firms from the obligation to maintain a 140% margin maintenance ratio for three months starting November 9.
As the U.S. stock market has seen significant declines and global economic uncertainties have increased, domestic market volatility has surged, prompting a cycle of forced liquidations that exacerbate stock price declines. Financial authorities plan to implement additional stabilization measures if market volatility continues to escalate.
* This article has been translated by AI.
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