Thai Bourse Announces Trading Rules Adjustment

The Stock Exchange of Thailand (SET) announces that the exchange has revised its trading rules to comply with practices of leading international stock exchanges in order to boost trading choices and make the exchange ready to cope with trading innovations, new products, and regional connections.

SET President Charamporn Jotikasthira, said: “Some trading rules have been amended to be more in line with standards of global leading stock exchanges. This should help facilitate investors, while enabling broker members to be ready for regional connections and increase our competitiveness at the international level. These changes underline SET’s commitment to enhance its services to match the right financial opportunities for investors and businesses and to increase attractiveness of the Thai capital market.”

Key revised trading rules include ceiling and floor adjustment, improvement in calculating opening and closing prices, increasing categories of market orders, and order amendment. Details are as follows:

  1. Ceiling and floor prices: To increase convenience for investors and broker members in coping with international standards. On their first trading day, the ceilings and floors of IPO prices and warrants, derivative warrants (DWs), and transferable subscription rights (TSRs) have to move in symmetric price bands.

    For equities and investment units, ceilings will be set at 300 percent of IPO prices, while ceilings of warrants, DWs, and TSRs must be no more than double the previous closing price of their underlying security multiplied by the exercise ratio. Floors of all mentioned securities must be no lower than THB 0.01.

  2. Opening and closing prices: the opening and closing prices will be those which yield the highest volume of trading. But if there is more than one price, the new system features a more precise searching mechanism to seek the price that more accurately reflects supply and demand.
  3. Market orders: market orders will be divided into categories in order to meet various demands from investors, such as special market orders, market orders, and market to limit orders. For instance, in market orders, bids and offers are matched by the trading system at market prices, and any unmatched orders left will be automatically cancelled.
  4. Order amendments: the bid amount can be reduced before the trading system matches the bid with an offer without losing the bid’s place in the queue. Previously, an investor had to cancel and re-submit the bid. However, this amendment doesn’t apply to increasing the bid amount.

These improvements, which also help increase flexibility for broker members’ operations, has been through hearings from member companies and has been approved by the SET Board of Governors. SET has notified members on details of the new rules and members are now ready for them. The revised rules will be implemented together with the new IT trading platform in the third quarter of this year.