Singapore Exchange (SGX) has added cum-entitlement (CE) and ex-entitlement (XE) indicators as new safeguards for the trading of newly consolidated shares, effective immediately.
Currently, shareholders are informed of a share consolidation via a company's announcement through SGXNet and shareholder circulars.
With these indicators, SGX says investors will be reminded that a stock is about to undergo, or has just undergone, a corporate action.
The CE and XE indicators will be displayed under the "remarks", or RMK, column of the stock price pages on www.SGX.com.
Meanwhile, SGX will introduce a reference price for newly consolidated stocks effective Dec 23.
The reference price is based on a theoretical price derived from the last traded price of the pre-consolidation trading counter.
It will be adjusted for the consolidation or split ratio and any cash distribution effective on the same date.
"In cases where this may be inappropriate, for example if multiple corporate actions are effective on the same date, SGX may choose an alternative means of determination and will inform members accordingly," it says.
Further to that, the reference price will be used to determine the forced order range, the application of dynamic circuit breakers and their price band, and the error trade no-cancellation range, SGX adds.
The new measures introduced by SGX come following the confusion over the recent share consolidation of New Silkroutes Group on Dec 16.
Ninety-one trades involving 52.3 million shares of the company were declared as "error trades" by the bourse regulator.
SGX cautions investors to exercise care when executing orders in stocks, which are undergoing share consolidation and splits.
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Currently, shareholders are informed of a share consolidation via a company's announcement through SGXNet and shareholder circulars.
With these indicators, SGX says investors will be reminded that a stock is about to undergo, or has just undergone, a corporate action.
The CE and XE indicators will be displayed under the "remarks", or RMK, column of the stock price pages on www.SGX.com.
Meanwhile, SGX will introduce a reference price for newly consolidated stocks effective Dec 23.
The reference price is based on a theoretical price derived from the last traded price of the pre-consolidation trading counter.
It will be adjusted for the consolidation or split ratio and any cash distribution effective on the same date.
"In cases where this may be inappropriate, for example if multiple corporate actions are effective on the same date, SGX may choose an alternative means of determination and will inform members accordingly," it says.
Further to that, the reference price will be used to determine the forced order range, the application of dynamic circuit breakers and their price band, and the error trade no-cancellation range, SGX adds.
The new measures introduced by SGX come following the confusion over the recent share consolidation of New Silkroutes Group on Dec 16.
Ninety-one trades involving 52.3 million shares of the company were declared as "error trades" by the bourse regulator.
SGX cautions investors to exercise care when executing orders in stocks, which are undergoing share consolidation and splits.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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