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As of July 29, 2007 closing call auctions on all shares, bonds and treasury bills will be held at the end of the trading.
The closing call– the same format as of the opening auction – will accumulate a large number of buy and sell orders, and will increase the quality of price discovery.
Prior to the closing call auction, there will be approximately 10-minutes “pre-closing” phase (similar to the “pre-opening”). During this time, orders will be submitted and theoretically, expected prices will be revealed and disseminated. The closing price will be the one set during the closing call alone, where the volume of the share at the closing call auction will be at least:
- NIS 400,000 in the TA-25.
- NIS 200,000 in the TA-75.
- NIS 100,000 in the “Mid Cap” index.
If the closing volume is less than mention above, the price will be set at the weighed average of the latest transaction prices, including those executed in the closing call.
Dror Shalit, Senior Vice-President and Head of the Trading and Clearing Department said that conducting a closing call auction at the TASE will upgrade the quality of the closing prices:
“The closing price is highly significant because it is the price that determines the calculation of the yields and portfolio evaluation for institutional investors, mutual funds and other institutional and private investors. This means that it is crucial that the price discovered will be of high quality".
Shalit pointed out that closing call auction is an accepted practice in the leading stock exchanges.
About the Tel Aviv Stock Exchange
Established in 1935, The Tel Aviv Stock Exchange (TASE) is a fully-automated exchange with a central order book trading system. TASE is a ‘one-stop shop’ for capital market activity in Israel, with an increasingly sophisticated range of products available to investors, including 120 ETFs (Index Products). In 2007, 46 new companies listed on TASE, including 16 high-tech companies; there are 26 biotech companies now listed on TASE.
