Deputy President, Strategy & Development of the KLSE, Abdul Hamid Sheikh Mohamed said that the exercise to standardise the board lots for all securities listed on the KLSE will be conducted in stages to ensure the maintenance of an orderly market.
"The first stage will involve all stocks in all sectors on the Second Board. The second, third and fourth stages will involve the conversion of stocks on the Main Board by sectors. MESDAQ Market stocks are already traded in 100 board lots.
"We will start implementing the first stage in April 2003 and we will conclude the exercise involving all four stages by June 2003," Abdul Hamid said.
The implementation plan through the four stages will be as follows :
|
STAGE |
BOARD |
SECTOR |
TOTAL NO. OF COMPANIES (as at 11/3/03) |
|
1 |
Second Board |
All Sectors |
351 |
|
2 |
Main Board |
Trading/Services |
108 |
|
3 |
Main Board |
Consumer Products |
319 |
|
4 |
Main Board |
Loans/Warrants/TSRs |
329 |
At each stage of implementation, the KLSE will announce the implementation date at least one week prior to the effective date. This is to allow sufficient time for investors, dealers and other market participants to make the necessary preparations.
To ensure industry readiness, system integration and simulation tests are being conducted between KLSE and stockbroking member companies.
"Only when we are satisfied with the system integration tests and sure of market readiness, will we be able to confirm the implementation date for the first stage," Abdul Hamid said.
In an earlier statement on 1 February 2003, KLSE had announced that the standard board lot of 100 units for all listed securities is expected to be implemented in stages in the second quarter of 2003. Currently, securities are traded on the KLSE in board lots of 100, 200 and 1,000 units.
The standard board lot will make investment in securities more accessible and affordable for all investors. The standard board lot will enhance investor participation in high value securities. Enhanced investor interest and participation will result in a more efficient price discovery and sustained market liquidity. The smaller board lot will help reduce holdings of odd lots. With the standard board lot of 100 units, many of these previous odd lot shares will be more marketable. Given the emphasis on shareholder distribution, the standard board lot will also enhance the shareholding spread of securities.
For more information on the standard board lot, please visit the KLSE website at www.klse.com.my for the frequently asked questions (FAQs) on standard board lot, available in both English and Bahasa Melayu. An Investor's guide brochure on "Standard Board Lot of 100 Units" in English, Bahasa Melayu and Mandarin will also be distributed through the network of Authorised Depository Agents (ADAs) and KLSE stockbroking member companies nationwide by 15 March 2003.
