Regulations Governing the Conduct of Discretionary Investment Business by Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises Article 16

The range of securities-related products which a SITE or SICE may trade using discretionary investment assets shall be limited to the following:1. Trading orders that futures commission merchants are allowed to handle per FSC announcements made in accordance with Article 5 of the Futures Trading Act, and trading in securities-related futures contracts, option contracts, and futures option contracts.2. FSC-approved off-exchange trading in financial products derived from currencies, securities, interest rates, or securities indices.A SITE or SICE trading securities-related products using discretionary investment assets may, with the approval of the FSC, be exempted from the restriction under subparagraph 1 of the preceding paragraph when necessitated by the basic investment or trading policies of the discretionary trading account.The ratios, methods of calculating risk exposure, and related regulations regarding the use of discretionary investment assets by a SITE or a SICE in trading securities-related products pursuant to the preceding two paragraphs shall be separately adopted by the FSC.When a SITE or a SICE has received FSC approval for concurrent operation of a managed futures enterprise, it may apply for approval by the FSC of exemption from the limiting ratios of the preceding paragraph with respect to its utilization of discretionary investment assets in trading securities-related products. Its risk exposure may not then exceed 100 percent of the net asset value of the discretionary investment account.