HANOI – Small investors will not be left out of the local stock market as Finance Minister Dinh Tien Dung rejected a plan of the Hochiminh Stock Exchange (HoSE) to raise the minimum volume of shares that can be traded in an order from 100 to 1,000 to address its trading system overload.
The minister expressed his disapproval over the plan at a meeting held on March 9 to discuss measures to address the system error frequently facing the southern bourse.
Since before the Lunar New Year holiday to date, the turnover of the southern bourse skyrocketed by 4-5 times versus the record highs in the past, leaving the technical system of HoSE often stuck in limbo. Consequently, there were innumerable losses caused by the system failure, especially during sessions wherein market turnover reached VND14-17 trillion.
To cope with the issue, HoSE and the State Securities Commission proposed extending the size of the standard lot to ease the overload and encourage small investors to switch to investing in exchange traded funds.
However, this plan could indirectly eliminate small investors from the stock market unjustly, while the system error facing the HCMC market would not be tackled thoroughly.
Aside from turning down the plan, Minister Dung at the meeting announced a decision to perfect the stock trading system and encouraged a number of stocks listed on HoSE to switch to trading on the Hanoi Stock Exchange (HNX) to ease the overload.
Further, the Finance Ministry approved a proposal of Truong Gia Binh, chairman of local tech giant FPT, on allowing private companies to cope with clogged trading activities in four months.
HoSE and FPT will jointly adopt measures to handle the system failure on the southern bourse, including applying the software currently used by HNX to HoSE. The measures will neither interrupt the stock market nor affect investors.
By Lan Nhi