Thailand Futures Exchange To Establish Investor Protection Fund


The Thailand Futures Exchange PCL (TFEX), under The Stock Exchange of Thailand (SET) group, joins hands with 33 brokers members to set up a Derivatives Investor Protection Fund (DIPF), with an initial worth of THB 100 million (approx. USD 3.23 million), aiming at building the confidence of investors, who trade derivatives on the exchange, as they will be protected against member broker bankruptcy or broker inability to return assets or compensate for loss in price of assets to investors.

The fund, approved by Securities and Exchange Commission, will be effective from November 15, 2012.

“The DIPF fund aims to boost confidence of Thai retail investors and domestic corporations, which are not institutional investors, investing in derivatives in TFEX via brokers which also are DIPF members. Protection is provided to investors when (1) any DIPF member broker is adjudicated as being bankrupt or (2) any member broker of DIPF fails to comply with an arbitration ruling requiring them to return assets or compensate for the price of assets to investors. Currently, there are 33 TFEX member brokers with mentioned investors as their customers. Brokers can apply to be fund member from November 15, 2012 on, and will pay a monthly fee starting January 2013, while the Exchange contributes the initial capital of THB 50 million. The DIPF fund is expected to reach THB 100 million target in the next 4 years,” TFEX Managing Director Kesara Manchusree noted.