South Korea's short-selling position reported to the regulator reached 5.6 trillion won (5.09 billion U. S. dollars) as of last Thursday as foreigners bet on the local stock market decline, the financial regulator said Thursday.

Covered short sales reported amounted to 5.6 trillion won as of Oct. 18, up from 5.2 trillion won as of end-August, according to the Financial Services Commission.

One and a half month earlier, the regulator introduced regulations that require investors to report their short selling position to the regulator if their positions rise above the 0.01 percent level of total market capitalization of respective stock.

Short-selling refers to the sale of shares by borrowing them in anticipation of price falls, before repaying the borrowed shares when the prices decrease. The trading practice has been considered as one of the main culprits for plunging stock prices.

The recent increase in short-selling position came as the local stock market made correction since mid-September due to fading positive effects from monetary easing measures by major central banks and re-emerging concerns over European debt problems.

Foreigners led the increase in bet on stock price falls. Short- selling position held by foreigners reached 4.97 trillion won as of last Thursday, accounting for 88.2 percent of the total. The number of foreigners who reported their positions stood merely at 23, indicating that a small number of foreigners led the stock decline betting. Endi

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