Alternative trading system (ATS) NEXTRADE (NXT) has exceeded the trading volume cap (the 15% rule) for the first time since its launch.
According to the financial investment industry on the 12th, as of the end of last month, the recent six-month (May 1–Oct. 31) average daily trading volume on NEXTRADE (NXT)'s regular market was about 216.81 million shares, which is 15.66% of the Korea Exchange (KRX)'s average daily trading volume (1,384.65 million shares) over the same period.
The current enforcement decree of the Financial Investment Services and Capital Markets Act stipulates that an alternative trading system's average daily trading volume over the most recent six months must not exceed 15% of the Korea Exchange (KRX)'s average daily trading volume.
Accordingly, NEXTRADE (NXT) has taken measures such as sequentially excluding 145 stocks from trading targets since Aug., but it is known to have struggled to manage the cap as trading volume surged when the KOSPI rose sharply in Oct.
However, even if the trading volume cap is exceeded, immediate sanctions are not imposed. In Sept., the Financial Services Commission (FSC), regarding NEXTRADE (NXT)'s trading volume limits, said, "We will maintain the market cap (15% of the Korea Exchange (KRX)), but if the cap is temporarily exceeded due to an unexpected surge in trading volume and is resolved within two months, we will not impose sanctions."
In addition, for the per-issue trading volume cap set at 30% of the Korea Exchange (KRX), the authorities have decided to prepare additional cap management measures while deferring enforcement of the regulation for up to one year.
A NEXTRADE (NXT) official said, "As we have been granted a two-month grace period, this does not constitute a regulatory violation, and there is no issue with compliance with the relevant rules."