SGX RegCo is proposing to remove the measure used to deal with market manipulation, saying it has developed more refined tools that have a more direct impact.
Singapore Exchange's (SGX) regulatory arm is proposing to scrap the minimum trading price (MTP) watch list, meant to deter the manipulation of penny stocks, according to an announcement posted on its website on Thursday.
The MTP watch list comprises smaller listed companies whose share prices are below S$0.20 and have an average daily market capitalization under S$40 million. There are currently 100 companies on the list, and only eight have triggered alerts of potential market manipulation.
The regulator is currently holding a month-long public consultation and while it makes a decision, no new companies will be added to the watch list, and there will be a moratorium on the three-year period companies have to exit the watch list, the notice said.
Fine-Tuning Tools
SGX has sharpened the tools used to deal with manipulation risk in the stock market, including adding the Trading Restriction and Trade with Caution alerts to make them more efficient and targeted. It has also launched a members' surveillance dashboard to alert each member of potential market misconduct, and has issued handbooks and guides to educate brokers.
«Taken together, these tools have a more direct impact on reducing manipulation risk and a review of the Minimum Trading Price policy is therefore timely,» said Tan Boon Gin, CEO of SGX RegCo.
