Strategy
Singapore's Stock Market Aims To Fight Back From Woes, Appeals To Retail Investors
The Singapore stock market is looking to make a number of changes to boost its appeal to investors, as the bourse seeks to rebound from a fall in trading volume and an embarrassing outage to its system late last year.
The Singapore stock market is looking to make a number of changes to boost its appeal to investors, as the bourse seeks to rebound from a fall in trading volume and an embarrassing outage to its system late last year.
Singapore Exchange Ltd is reportedly aiming to cut the standard lot size for equity transactions to 100 shares from 1,000 shares on 19 January 2015, Bloomberg reported, quoting industry figures as saying that this will reduce the cost to trade in smaller blocks of shares. The average value of shares traded daily on the exchange fell by 25 per cent to S$1.05 billion ($794 million) during 2014.
The exchange will also reportedly set a minimum trading price of S$0.20 on mainboard shares as low-priced securities are more susceptible to excessive speculation and potential market manipulation.
On the derivatives side of the business, Singapore Exchange said in late December that it will upgrade its derivatives trading and clearing platforms to boost Singapore’s market infrastructure and to support volume growth in SGX’s derivatives business.
The upgraded platforms, SGX TITAN, will ensure continued agility and innovation in terms of new products and services offered by SGX, it said in a statement. The move is designed to increase efficiency and lower trading and clearing costs for market participants. In addition, SGX will extend its engagement with Nasdaq for a further six years to support and maintain the Nasdaq systems in its securities and derivatives markets.
The exchange needs to raise its game in an increasingly competitive landscape, as rival bourses in Hong Kong and Shanghai, for example, seek to push ahead with their exchange link. In early December 2014, the Monetary Authority of Singapore fired a warning at the city’s stock exchange for a delay in opening trading that lasted until 12:30 pm local time on 3 December.
