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- GPW changes the tick size of shares and ETFs as of 4 March 2019
- Prices of shares and ETFs will be determined with a precision of four decimal places (PLN 0.0001)
- The new tick sizes are introduced to ensure alignment of the Polish market with European standards
- The new tick sizes will apply to all shares on the Main Market and NewConnect
“A new tick size effective on GPW as of 4 March 2019 implies that shares and other financial instruments will be traded with a precision of four decimal places. The roll-out date of the modifications has been set in arrangement with market participants. The change of the tick size follows from standards applicable on other European trading venues and aligns our market with those standards to ensure its competitiveness,” said Piotr Borowski, GPW Management Board Member.
At present (until 4 March 2019), the tick size of most shares and ETFs ranges (depending on the instrument) from one to several grosh. The modification will introduce six new tick sizes under PLN 0.001 equal to PLN 0.0001, PLN 0.0002, PLN 0.0005, PLN 0.0010, PLN 0.0020, and PLN 0.0050.
The tick size of shares and ETFs on GPW depends on the price of the instrument and the liquidity (value) of turnover. There are six tick size tables, each for a different liquidity level (see the example presented below). Table 1 applies to the least liquid shares and Table 6 to the most liquid shares. Shares are classified by liquidity by the European Securities and Markets Authority (ESMA). The modifications represent the second phase of GPW’s implementation of the tick size under MIFID II/MIFIR.
Table 1. Tick size table effective as of 4 March 2019
|
Price range |
Table 1 |
Table 2 |
Table 3 |
Table 4 |
Table 5 |
Table 6 |
|
0.01 ≤ price < 0.1 |
0.0005 |
0.0002 |
0.0001 |
0.0001 |
0.0001 |
0.0001 |
|
0.1 ≤ price < 0.2 |
0.001 |
0.0005 |
0.0002 |
0.0001 |
0.0001 |
0.0001 |
|
0.2 ≤ price < 0.5 |
0.002 |
0.001 |
0.0005 |
0.0002 |
0.0001 |
0.0001 |
|
0.5 ≤ price < 1 |
0.005 |
0.002 |
0.001 |
0.0005 |
0.0002 |
0.0001 |
|
1 ≤ price < 2 |
0.01 |
0.005 |
0.002 |
0.001 |
0.0005 |
0.0002 |
|
2 ≤ price < 5 |
0.02 |
0.01 |
0.005 |
0.002 |
0.001 |
0.0005 |
|
5 ≤ price < 10 |
0.05 |
0.02 |
0.01 |
0.005 |
0.002 |
0.001 |
|
10 ≤ price < 20 |
0.1 |
0.05 |
0.02 |
0.01 |
0.005 |
0.002 |
|
20 ≤ price < 50 |
0.2 |
0.1 |
0.05 |
0.02 |
0.01 |
0.005 |
|
50 ≤ price < 100 |
0.5 |
0.2 |
0.1 |
0.05 |
0.02 |
0.01 |
|
100 ≤ price < 200 |
1 |
0.5 |
0.2 |
0.1 |
0.05 |
0.02 |
|
200 ≤ price < 500 |
2 |
1 |
0.5 |
0.2 |
0.1 |
0.05 |
|
500 ≤ price < 1 000 |
5 |
2 |
1 |
0.5 |
0.2 |
0.1 |
|
1 000 ≤ price < 2 000 |
10 |
5 |
2 |
1 |
0.5 |
0.2 |
|
2 000 ≤ price < 5 000 |
20 |
10 |
5 |
2 |
1 |
0.5 |
|
5 000 ≤ price < 10000 |
50 |
20 |
10 |
5 |
2 |
1 |
|
10 000 ≤ price < 20 000 |
100 |
50 |
20 |
10 |
5 |
2 |
|
20 000 ≤ price < 50 000 |
200 |
100 |
50 |
20 |
10 |
5 |
|
50 000 ≤ price |
500 |
200 |
100 |
50 |
20 |
10 |
With the change of the tick size, prices of shares and ETFs on the exchange will be determined with a greater precision than before. This could help to narrow market spreads (the difference between the ask price and the bid price) and ensure a more precise market valuation of the instruments. The change will be particularly relevant for penny stocks, for which a price change by PLN 0.01 represents a major percentage change in value.
The planned modifications include the clearing and settlement of transactions made at a price determined with a precision of four decimal places. For this purpose, each transaction will be rounded off to PLN 0.01. Fractional amounts under PLN 0.005 will be omitted and fractional amounts of PLN 0.005 or more will be rounded up to PLN 0.01.
For more information and educational materials on the increased precision of the tick size, visit the GPW dedicated website.
