Companies listed on SGX and all qualified research firms are eligible for the scheme, subject to the approval of SGX and MAS. Under the scheme, each participating research firm will provide regular research coverage on at least 15 stocks, and each participating listed company will be covered by at least 2 research firms.
Research reports generated under this scheme will be published on the SGX website and made available free of charge to the public.
To help defray the costs in providing the research coverage, each research firm will receive an annual sum of S$60,000 for every 15 stocks covered. This will be funded from the S$7.5 million pool of funds jointly established by SGX and MAS in June 2003 for developing the securities and derivatives industry. Participating listed companies will only need to pay a nominal annual fee of S$4,000. Other uses of the S$7.5 million pool of funds will be decided later.
SGX CEO Hsieh Fu Hua said, "Besides helping investors make better-informed decisions, this scheme will raise the profile of our listed companies and enhance the attractiveness of SGX as a listing venue."
Mr Shane Tregillis, Assistant Managing Director of MAS added, "We hope the scheme will be beneficial to both listed companies and investors. We expect the quality of research provided to be of high standards and the scheme will facilitate greater investor understanding and interest in the SGX-listed companies."
SGX-listed companies and research firms will be invited to participate in the scheme. The list of participating research firms and listed companies will be announced when responses have been received and collated over the next month or so. The scheme will be offered for a period of 2 years, after which it will be reviewed by SGX and MAS.
