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phuocpham
10-12-2009, 06:17 PM
In response to increasing investor demand, the State Securities Commission may soon allow investors to realise quick profits by re-selling shares within two days of their purchase, said Nguyen Thanh Binh, Deputy Head of the Commission’s Market Development Department.
Under a current rule known as T+4, investors are not allowed to sell a purchased shares until the transaction has cleared, typically four days after the initial share purchase.
Such a long clearance period frequently causes investors to miss good opportunities to turn around a quick profit on the stock market, in the observation of market watchers, Binh said at a conference held late last week in Ha Noi by the Viet Nam Depository Centre.
"We have proposed the Ministry of Finance to shorten the time, allowing investors to make trades in the two days before the transaction has been settled," Binh said, claiming that many developing markets did not ban advanced trading before securities were cleared into investors’ accounts.
The proposed change will help meet market demand and international standards, Binh said, but noting that sort of trading was different from short sales in which investors would trade in securities they did not own.
SJC Securities Co. General Director Huynh Anh Tuan agreed with the proposed change.
"A regulation on the policy should be issued to provide securities companies time for preparation, as well as strict administrative guidelines for its implementation." Tuan said.
Truong Son Securities Co. General Director Pham Ngoc Thang also said that securities companies needed time to prepare for any new trading method, including time to revise technical system and retrain staff.
"Securities companies will support this policy because such trading will reduce investor risk and promote market liquidity," Thang said.