CONTINUOUS ALL DAY TRADING (CAT)

Transcription

1 Dear Valued Clients CONTINUOUS ALL DAY TRADING (CAT) SGX will introduce continuous all-day trading (CAT) on the SGX-ST securities market from 1 August 2011 to allow you to trade during lunch period, between 12.30pm and 2.00pm. During the extended trading hours between 12.30pm and 2.00pm, your Trading Representative (TR) could be away from the desk and news screens. Hence, the Company is providing the following alternative arrangements to cater to your trading needs: the use of central dealing desks, where the TRs may channel clients orders to these central dealers for order execution; the appointment of a back-up TR ( buddy ) to handle clients' orders; the use of mobile technology or hand-held equipment by the TR to execute customers orders while he/she is outside the office premises; POEMS online internet trading Please check with your TR on his/her modes of execution during the extended lunch hour trading. If you require clarifications on the options available to you or your preferred mode of trading, please speak to your TR. Should you have further concerns after consulting your TR, you may send your queries to op_notification@phillip.com.sg. For more information on CAT, please visit SGX s website at Yours Sincerely, Phillip Securities Pte Ltd

2 30 June 2011 SGX INTRODUCES CONTINUOUS ALL-DAY TRADING (CAT) Singapore Exchange (SGX) will be introducing continuous all-day trading for the securities market on 1 August This will allow you to trade on SGX during lunch period, between 12.30pm and 2.00pm. SGX trading hours will overlap with those of other Asian exchanges, allowing investors in pan-asian securities to respond to news flow in the home markets and provide them greater convenience. When trading between 12.30pm and 2.00pm, you should be aware that your Trading Representative (TR) i.e. your dealer or remisier, may be away from the desk and news screens. When TRs are away from the desk, Member firms (brokerage firms) will apply their existing arrangements, as follows: the use of central dealing desks, where the TRs may channel customers' (your) orders to these central dealers (who are also licensed TRs) for order execution; the appointment of a back-up TR to handle customers' (your) orders when your primary TR is away from the office; the use of mobile technology or hand-held equipment by the TR to execute customers (your) orders while he/she is outside the Member's office premises. Please note that when CAT starts, demand and supply conditions in the market could be less favourable between 12.30pm and 2.00pm than the rest of the trading day. For instance, market volume may be lower as market participants may be unfamiliar with the new hours. This may affect the price and quantity of orders which can be executed during this period. The level of service from your TRs may also be affected. Relaying your order to the market may take a little longer than usual and response to your questions may be less timely. Investors are encouraged to discuss order execution and management with their TRs. Investors using the on-line internet trading platform and who occasionally rely on TRs to amend or withdraw their orders should also discuss order execution and management with their TRs. With CAT, any resting, unmatched orders queuing in the trading system may be matched throughout the day including during the period between 12.30pm to and 2.00pm as the market absorbs news, orders and developments. You are reminded to monitor the status of orders given to your TR and the developments of the market all day, including the period from 12.30pm to 2.00pm. You can also expect to receive a one-off request from your TR to confirm that you are aware of how you will be serviced during the period between 12.30pm to 2.00pm. Singapore Exchange Securities Trading Limited Company Reg No D (a wholly-owned subsidiary of Singapore Exchange Limited) 2 Shenton Way, #19-00 SGX Centre 1, Singapore Main: (65) Fax: (65)

3 Please consider carefully how you will like to be serviced by your Member and TR, especially during the 12.30pm to 2.00pm period. If you do not wish to use any of the three arrangements stated earlier during this period, there are other modes of trading available such as on-line internet trading where you can enter orders directly into Members trading systems. If you are uncertain about the options available to you or your preferred mode of trading, please speak to your Member and TR. Please visit SGX s website at for more information on continuous all-day trading and arrangements for order execution. Members' websites will also carry these information in the coming week and by next Wednesday, 6 July There will also be information on continuous all-day trading carried on SIAS website at To further help you understand CAT and its implications, we have prepared a Question and Answer sheet.

4 QUESTIONS AND ANSWERS ON CONTINUOUS ALL-DAY TRADING 1. What is continuous all-day trading? This means that in addition to existing trading hours, you will be able to trade in SGX securities during 1230 to 1400 hours from 1 August SGX-ST will be opened from 0900 to 1705 hours every trading day. 2. What s in it for me? The additional opening hours will enhance your trading opportunities since you can also trade during 1230 to 1400 hours in addition to the existing trading hours. Moreover, SGX trading hours will overlap with those of other Asian exchanges. If you trade pan-asian securities, this will provide you with greater convenience by allowing you to respond to news flow in the home markets and other Asian markets. 3. What should I expect? You should speak with your dealer or remisier whether he/she expects to regularly be at the desk during 1230 to 1400 hours, and how he/she expects to service you when off-premises. As you know, your dealer or remisier could be out for lunch break, attend training, take care of business administrative matters or do something else during 1230 to 1400 hours. To facilitate seamless trading for investors like you, broking houses have put in place arrangements to handle customer orders during 1230 to 1400 hours. We understand such trading arrangements to include some or all of the following: the use of central dealing desks, where your dealer or remisier may channel your orders to these central dealers (who are licensed), for order execution; the appointment of a back-up dealer or remisier to handle your orders when your dealer or remisier is away from the office; the use of mobile technology or hand-held equipment to perform order execution if your dealer or remisier is working outside of the company s office. You can also expect to receive a one-off request from your dealer or remisier to confirm that you are aware of how you will be serviced during the period from 1230 to 1400 hours. 4. Do all Members of SGX-ST offer the same trading arrangements during 1230 to 1400 hours? Members have their own specific arrangements. Generally, central dealing desks and back-up dealer or remisier arrangements are offered by all Members.

5 5. What is the effect of the additional trading hours on my portfolio of SGX assets? The value of your portfolio of assets traded on SGX-ST could change during 1230 to 1400 hours, just as it could whenever SGX-ST is open. If the price of the shares you hold falls, the value of your portfolio will fall accordingly. 6. Are prices likely to move much during 1230 to 1400 hours? Prices move up or down in response to demand and supply. Buy and sell orders may be entered into SGX-ST in response to economic and business news, forecasts, portfolio adjustments, and other factors. For example, if there is release of news that may be considered significant during 1230 to 1400 hours, prices could move on SGX-ST. Similarly, trading decisions carried out by investors or traders could also move prices. 7. Will the market be less liquid during 1230 to 1400 hours than at other times of the trading day? Market liquidity depends on various factors including the volume of orders coming into the market and number of active participants. It is possible that there will be fewer participants and less orders especially while people become accustomed to the new trading period and test market conditions. The situation is dynamic and you should monitor developments in the market. 8. Will service quality from remisiers and brokers be lower during 1230 to 1400 hours? There may well be increased latency/delay in order execution, order management and response to enquiries, if your dealer or remisier is not at his/her desk. Your orders and enquiries may be relayed to a central dealer or back-up dealer or remisier who is in the office. Delays or limitations could also occur if your dealer or remisier use mobile technology or hand-held equipment. This may affect the price and quantity of any orders executed during this period. It is important that you agree with your broker or remisier how you are serviced when he/she is away from the desk. You will then know what to expect and can decide whether or not you wish to transact in the market. 9. How do I know what is happening to my orders during 1230 to 1400 hours? We encourage you to closely monitor the status of your orders entered in the trading system. If you have any resting, unmatched orders queuing in the trading system that may be carried through the period from 1230 to 1400 hours, you should be aware they may be matched. You may wish to monitor the price movements in the market or provide specific instructions to your dealer or remisier on the treatment of these orders.

6 10. Which trading alternative or arrangement is appropriate for me? You should carefully assess the various trading alternatives and arrangements your broker offers you and decide which one suits your trading needs after weighing the pros and cons of each alternative. If you are uncertain about what each alternative mean to you or your preferred mode of trading, you should discuss this matter with your dealer or remisier. 11. Do I have any other alternatives? If you decide that none of the trading arrangements mentioned above in Question 3 suits you, an alternative is transacting on-line through an internet trading account where you enter orders directly into your broker s trading system. You could also refrain from trading during 1230 to 1400 hours until you are sure of what you want. 12. Where can I obtain more information about continuous all-day trading? You can go to SGX s website at Members' websites will also carry information on continuous all-day trading in the coming week and by next Wednesday, 6 July There will also be information carried on SIAS website at