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Post by puregold on Oct 16, 2013 15:02:47 GMT 7
With another small cap stock Chasen plunging like nobody's business, it is high time SGX looks into introducing circuit breaker.
<not vested in Chasen>
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Post by oldman on Oct 16, 2013 15:50:21 GMT 7
Puregold, I am not sure whether it will make that much difference. Usually, stocks fall as a result of aggressive selling by funds or forced selling by the banks. Circuit breakers will then simply delay the selling and extend it for a few days. If funds intend to sell, they will sell regardless. The only situation when it will make a difference is when information is not fairly disseminated. This frankly is quite rare as usually the listed company management is as much "in the dark" as anyone else. If they knew anything, they should have already acted and informed the market. The standard reply is that they are in discussions with other companies on joint ventures, etc..... so is every other company listed or unlisted. In theory, circuit breakers is a good thing to have but in practice, I am not sure it will make that much difference..... for traders, it will take away the fun of the market!
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Post by puregold on Nov 29, 2013 15:17:22 GMT 7
www.businesstimes.com.sg/premium/companies/others/allow-stop-loss-cash-market-retail-players-20131129
THE BUSINESS TIMESPublished November 29, 2013 HOCK LOCK SIEWAllow stop-loss, cash market for retail playersBy R Sivanithy sivan@sph.com.sg IN A FEW months' time, the local stock market should see the introduction of dynamic circuit breakers in daily trading, which are aimed at giving traders a five-minute cooling-off period to think about what they are doing when prices move by more than 10 per cent in either direction. Retail traders - so often on the receiving end of sudden, unwanted volatility - should welcome this as it means they have a greater chance of reducing their losses and preserving their capital when prices plunge abruptly. Looking after retail interests is all the more important given the increasing presence of computerised trading and the Singapore Exchange's (SGX) stated plan to eventually bring in high-frequency traders to enhance liquidity here. However, circuit breakers are only a start. More should be done to preserve the interests of small investors and to give them at least a fighting chance in a market which is already dominated by house traders, proprietary desks and algorithmic players using super-fast computers.
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Post by puregold on Jan 22, 2014 14:03:27 GMT 7
www.bloomberg.com/news/2014-01-22/singapore-exchange-to-add-circuit-breakers-next-month.html Singapore Exchange to Add Circuit Breakers Next MonthBy Eleni Himaras - Jan 22, 2014 Singapore Exchange Ltd., Southeast Asia’s biggest bourse, will add circuit breakers next month that protect investors from excessive stock swings after a plunge in three commodity companies erased $6.9 billion in market value. The trading restrictions will apply to Straits Times Index (FSSTI) and MSCI Singapore Index members and all securities priced from 50 Singapore cents from Feb. 24, according to a regulatory filing from the bourse. The circuit breakers are triggered when a stock rises or falls more than 10 percent from at least five minutes earlier and cause a five-minute period where trading is limited, according to the statement. The rules cover securities that account for about 80 percent of trading on the Singapore market. The exchange operator said in October that it would implement automatic price controls after declines in commodity companies Blumont Group Ltd., Asiasons Capital Ltd. and LionGold Corp. spurred an investigation by the Monetary Authority of Singapore. All three companies have said they don’t know what precipitated the plunge. Hong Kong Exchanges & Clearing Ltd. is studying whether its market needs circuit breakers to prevent trading errors from causing large declines or surges in prices, a person familiar with the matter said this month. “The introduction of circuit breakers and the new error-trade policy will assure investors of continued safety and transparency even under volatile market conditions,” Muthukrishnan Ramaswami, president of SGX, said in the statement. Erroneous Trades If the circuit breaker is triggered, investors can only trade within 10 percent of the reference price from at least five minutes earlier, according to the statement. Normal trading resumes five minutes later. The bourse operator will also revise its erroneous trade policy, it said. Purchases will not be canceled if the price falls within a range of 5 percent or 20 minimum bid sizes from the last traded price for most securities. The price range for structured warrants will be 25 percent or 20 minimum bid sizes from the last valid price, SGX said. Trades done outside of the relevant price range are eligible for review by SGX, the bourse operator said in the statement. Exchanges have responded to the increased automation of trading by introducing curbs to prevent mistaken transactions from influencing prices. U.S. equity markets are now protected by a system known as limit up/limit down, which prevents trades outside certain price bands. Chicago-based CME Group Inc., owner of the world’s biggest futures market, pauses trading during extreme volatility.
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Post by zuolun on Jan 22, 2014 15:22:08 GMT 7
The +ve result of trading curbs on many penny and micro penny stocks imposed by individual brokering firms to protect investors is yet to be seen but the SGX and most of the stock brokerage firms have already lost their bread-and-butter business past few months due to a sharp decline in trading volume after the BAL saga. The implementation of Circuit Breakers next month may exacerbate market instead of providing protection to investors. Should a steep correction occur and the STI were to hit crucial support at 2775, activation of the Circuit Breakers would be disastrous in a falling market with thin volume. Just imagine when there is a fire and you activate the system to lock everyone inside the building, what will happen to them? www.bloomberg.com/news/2014-01-22/singapore-exchange-to-add-circuit-breakers-next-month.html Singapore Exchange to Add Circuit Breakers Next MonthBy Eleni Himaras - Jan 22, 2014 Singapore Exchange Ltd., Southeast Asia’s biggest bourse, will add circuit breakers next month that protect investors from excessive stock swings after a plunge in three commodity companies erased $6.9 billion in market value. The trading restrictions will apply to Straits Times Index (FSSTI) and MSCI Singapore Index members and all securities priced from 50 Singapore cents from Feb. 24, according to a regulatory filing from the bourse. The circuit breakers are triggered when a stock rises or falls more than 10 percent from at least five minutes earlier and cause a five-minute period where trading is limited, according to the statement. The rules cover securities that account for about 80 percent of trading on the Singapore market. The exchange operator said in October that it would implement automatic price controls after declines in commodity companies Blumont Group Ltd., Asiasons Capital Ltd. and LionGold Corp. spurred an investigation by the Monetary Authority of Singapore. All three companies have said they don’t know what precipitated the plunge. Hong Kong Exchanges & Clearing Ltd. is studying whether its market needs circuit breakers to prevent trading errors from causing large declines or surges in prices, a person familiar with the matter said this month. “The introduction of circuit breakers and the new error-trade policy will assure investors of continued safety and transparency even under volatile market conditions,” Muthukrishnan Ramaswami, president of SGX, said in the statement. Erroneous Trades If the circuit breaker is triggered, investors can only trade within 10 percent of the reference price from at least five minutes earlier, according to the statement. Normal trading resumes five minutes later. The bourse operator will also revise its erroneous trade policy, it said. Purchases will not be canceled if the price falls within a range of 5 percent or 20 minimum bid sizes from the last traded price for most securities. The price range for structured warrants will be 25 percent or 20 minimum bid sizes from the last valid price, SGX said. Trades done outside of the relevant price range are eligible for review by SGX, the bourse operator said in the statement. Exchanges have responded to the increased automation of trading by introducing curbs to prevent mistaken transactions from influencing prices. U.S. equity markets are now protected by a system known as limit up/limit down, which prevents trades outside certain price bands. Chicago-based CME Group Inc., owner of the world’s biggest futures market, pauses trading during extreme volatility.
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Post by stockpicker on Jan 22, 2014 15:51:29 GMT 7
Most retail investors cannot usually time when to buy stock correctly and many resort to buy and hold. With the recent BAL saga, all retailers are scare to buy and hold and most are not quite confident in shorting as well; therefore, the trading volume suffered as a result as many sit on the side line. If there is a circuit breaker, it would not make much different initially except some daring ones may be more daring to buy and hold. When these daring ones started to make some profits and announce so in the forums (invariably, most like to boast), others will join them. Lets give this circuit breaker a try, at least, we can limit those who want to "destroy" the market one way or other through dumping the stock like there is no tomorrow.
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Post by zuolun on Jan 22, 2014 16:11:04 GMT 7
Most retail investors cannot usually time when to buy stock correctly and many resort to buy and hold. With the recent BAL saga, all retailers are scare to buy and hold and most are not quite confident in shorting as well; therefore, the trading volume suffered as a result as many sit on the side line. If there is a circuit breaker, it would not make much different initially except some daring ones may be more daring to buy and hold. When these daring ones started to make some profits and announce so in the forums (invariably, most like to boast), others will join them. Lets give this circuit breaker a try, at least, we can limit those who want to "destroy" the market one way or other through dumping the stock like there is no tomorrow.
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Post by stockpicker on Jan 22, 2014 17:38:51 GMT 7
Zuolun, your quote is very cheem. It has good, bad and plain simple meanings when one does a web search.. most think that it means different people have different encounters and different views on the same subject matter. but this guy went into great length to explain what that means. thanks and all the best..
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Post by zuolun on Jan 22, 2014 17:49:34 GMT 7
In life, it doesn't matter if you win or lose, what matters most is that, you've done your best.Zuolun, your quote is very cheem. It has good, bad and plain simple meanings when one does a web search.. most think that it means different people have different encounters and different views on the same subject matter. but this guy went into great length to explain what that means. thanks and all the best..
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Post by zuolun on Jan 23, 2014 9:06:02 GMT 7
The +ve result of trading curbs on many penny and micro penny stocks imposed by individual brokering firms to protect investors is yet to be seen but the SGX and most of the stock brokerage firms have already lost their bread-and-butter business past few months due to a sharp decline in trading volume after the BAL saga. The implementation of Circuit Breakers next month may exacerbate market instead of providing protection to investors. Should a steep correction occur and the STI were to hit crucial support at 2775, activation of the Circuit Breakers would be disastrous in a falling market with thin volume. Just imagine when there is a fire and you activate the system to lock everyone inside the building, what will happen to them? In a rising (bull) market with strong volume, prices will rise higher high with extremely stronger volume. In a falling (bear) market with thin volume, prices will fall lower low by its own weight without extremely strong volume.
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