It wants sellers to mark short sales orders; and it’ll publish the total for each stock daily
By JAMIE LEE 28 November 2008
The Singapore Exchange (SGX) yesterday proposed plans to disclose short-selling activities.
SGX has suggested in a consultation paper that brokers and customers that have gone short on securities - including structured warrants and exchange-traded funds - must mark all their orders to indicate short sales.
It has also proposed to publish the total number of short-selling orders transacted for individual securities every day. ‘The marking of short-selling orders will facilitate the collation of data on short-selling activities in Singapore,’ SGX said.
Another proposal by SGX is that holders of one per cent of short positions in individual securities must report their positions every month to the exchange.
The bourse deems a threshold of one per cent as a ‘substantial short position’.
These measures come on top of current steps: publishing the daily list of buying-in securities and details of the price and volumes of shares bought in.
SGX said that the latest measures, if implemented, are likely to require ‘legal obligations’ to ensure compliance by market players. ‘SGX is also mindful that a statutory framework will be required in order to place legal obligations on customers.’
Markets players said that the move would offer more transparency while easing some concern in the market over short-selling. ‘A lot of people are blaming the ‘shorties’ for causing the panic,’ said one dealer from a regional brokerage.
This move follows that of Hong Kong, which already publishes the short sales twice a day, said a broker from a local bank.
But one former dealer noted that not all traders might welcome the transparency. ‘If I were a big trader, I wouldn’t want people to know that I went short,’ said the ex-broker.
The public can offer feedback on the consultation paper till Dec 22, it said.
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SGX Proposes Greater Short-Selling Disclosure
It wants sellers to mark short sales orders; and it’ll publish the total for each stock daily
By JAMIE LEE
28 November 2008
The Singapore Exchange (SGX) yesterday proposed plans to disclose short-selling activities.
SGX has suggested in a consultation paper that brokers and customers that have gone short on securities - including structured warrants and exchange-traded funds - must mark all their orders to indicate short sales.
It has also proposed to publish the total number of short-selling orders transacted for individual securities every day. ‘The marking of short-selling orders will facilitate the collation of data on short-selling activities in Singapore,’ SGX said.
Another proposal by SGX is that holders of one per cent of short positions in individual securities must report their positions every month to the exchange.
The bourse deems a threshold of one per cent as a ‘substantial short position’.
These measures come on top of current steps: publishing the daily list of buying-in securities and details of the price and volumes of shares bought in.
SGX said that the latest measures, if implemented, are likely to require ‘legal obligations’ to ensure compliance by market players. ‘SGX is also mindful that a statutory framework will be required in order to place legal obligations on customers.’
Markets players said that the move would offer more transparency while easing some concern in the market over short-selling. ‘A lot of people are blaming the ‘shorties’ for causing the panic,’ said one dealer from a regional brokerage.
This move follows that of Hong Kong, which already publishes the short sales twice a day, said a broker from a local bank.
But one former dealer noted that not all traders might welcome the transparency. ‘If I were a big trader, I wouldn’t want people to know that I went short,’ said the ex-broker.
The public can offer feedback on the consultation paper till Dec 22, it said.
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