Toss Securities decided to delay the official launch of its U.S. stock options service. The decision follows controversy that it overly simplified explanations of options products and encouraged investment in high-risk derivatives.
According to the financial investment industry on the 7th, Toss Securities decided to temporarily delay the launch of its U.S. stock options service. The original launch date was the 10th of this month.
Earlier, Toss Securities began offering the U.S. stock options service to preregistered users on the 3rd of this month. It came about nine months after approval from the Financial Services Commission (FSC) on Feb. 5.
However, ahead of the official service launch, some promotional phrases drew criticism for encouraging high-risk investing.
In its mobile trading system (MTS), Toss Securities used ads that emphasized high returns and entertainment, such as "If Nvidia rises 5%, the option price rises 214%" and "Next Friday, will Pfizer's share price go up or down (betting)."
Options trading refers to trading the "right" to buy or sell a specific stock at a predetermined price in the future. Options are one of the high-risk derivatives; they allow large transactions with small amounts of money, creating strong leverage, but the risk of loss is also very high.
Toss Securities said, "As of the afternoon of the 6th, the options simulation experience and additional preregistration and events have been temporarily suspended," and "We are comprehensively reviewing guidance phrases that could cause customer misunderstandings."
It added, "We plan to support investor education and mock transactions equivalent to the pre-education for overseas derivatives investment that will be implemented next month, and strengthen investment risk disclosures."