Singapore Exchange (SGX)

[freedom]

I was hoping for board lot of 1 share. maybe that will drive companies to reverse split.

Just wondering, will there be too many ultra small investors for companies to handle when sending out letters and Annual Reports?

sending out paper circulars and annual reports is really unnecessary in this electronic age.

investors should register their interests for the format of letters and annual reports to be received.

[d.o.g.]

Just wondering, will there be too many ultra small investors for companies to handle when sending out letters and Annual Reports?

Many companies have already shifted to mailing CDs instead of paper reports. Most likely SGX will eventually allow electronic distribution i.e. companies can just email you the PDF instead of sending you the PDF on a CD. Right now they still have to physically send a report (but that report can be an electronic one).

[Nick]

If I am not mistaken, while ASX do allow 1 share trading, the minimum value of any odd-lot trade must exceed A$500. Perhaps SGX could add such a criteria to prevent uneconomical accumulation of stocks which will reduce wastage - mailing of annual reports, AGM size etc.

[lonewolf]

Its about time! Long overdue! But a corresponding reduction in the min commission charged by brokers must also be instituted else there wont be any advantages for retail investors to buy in broad lot of 100 units. I dun think SGX can do anything about the commission structure, can they?

SGX seeks to reduce standard board lot size to 100 units
SINGAPORE: The Singapore Exchange (SGX) is seeking to reduce the standard board lot size of securities listed on the exchange from 1,000 to 100 units.

SGX is consulting the public on the proposed move, before it makes a formal application to the Monetary Authority of Singapore.

In a statement released on Monday, SGX said it aims to introduce the smaller board lot size by the first quarter of next year. It added that this move is "subject to regulatory approval and member readiness".

This proposal is being made with a view to reduce the standard board lot size to one unit in the longer term.

SGX said the smaller board lot size will benefit both retail and institutional investors.

Retail investors will find investing in index component stocks and blue chips more affordable, and need not be limited to lower-priced penny stocks.

Institutional investors will be able to better manage their risk exposures through finer asset allocation of funds.

The proposed standard board lot size of 100 units will apply to ordinary shares, real estate investment trusts, business trusts, company warrants, structured warrants, extended settlement contracts and shares on GlobalQuote.

But board lot sizes for exchange traded funds - barring the SPDR STI ETF and ABF SG Bond Fund - American Deposit Receipts and fixed income instruments, including Singapore Government Securities and preference shares, will remain unchanged.

- CNA/ms

[ SOURCE ]

This is the announcement >> SGX consults public on reduced board lot size

The Consultation Paper on Reduction in Board Lot Size page is right over here .

The pdf file is here .

[wsreader]

One thing I like about reduced board lot size is that investor can implement constant dollar averaging investment plans more efficiently, by himself.

As for the use of electronic distribution to handle ultra small investors, another advantage is in the sending of minutes of agm. Iirc, listed companies will send minutes of agm to shareholders upon request, but at a charge of certain amount per page to cover the printing cost. If the minutes can be email to shareholders in pdf format, there is no reason to justify the per page charge.

[TheMillennium]

This will encourage more young people with limited funds to invest. But it could be a double edged sword.

New investors may take more risks when hearing of others' success stories that investing is a get rich quick scheme, thinking that their few 100 or 1000 bucks can make them rich as long as they make the right bet or follow others.

Also, will reducing the board lot size hurt the OCBC blue chip investment and POSB invest scheme?

[brattzz]

i think this is a GREAT idea finally!! and 1 lot should be able to trade by anyone!!

[felixleong]

Yeah they should be like US
min 1 share trades
but also stocks should trade $1 or above
else they should be put into OTC board

just feels so stupid when investors are queuing to buy/sell digilands for 0.001

[CityFarmer]

Since this thread is SGX related, i merged this thread into SGX thread. Please take note

Thanks

[Some-one]

I don't know if I am playing the devil's advocate or not. Did anyone not realise that it would increase the number of shareholders attending AGM and this might be counter productive to real discussion in the AGM? I suggest that only those holding 1000 shares and above can attend the AGM but retailers can still buy shares lesser than 1000.