SGX seeks to reduce standard board lot size to 100 units
SINGAPORE: The Singapore Exchange (SGX) is seeking to reduce the standard board lot size of securities listed on the exchange from 1,000 to 100 units.
SGX is consulting the public on the proposed move, before it makes a formal application to the Monetary Authority of Singapore.
In a statement released on Monday, SGX said it aims to introduce the smaller board lot size by the first quarter of next year. It added that this move is "subject to regulatory approval and member readiness".
This proposal is being made with a view to reduce the standard board lot size to one unit in the longer term.
SGX said the smaller board lot size will benefit both retail and institutional investors.
Retail investors will find investing in index component stocks and blue chips more affordable, and need not be limited to lower-priced penny stocks.
Institutional investors will be able to better manage their risk exposures through finer asset allocation of funds.
The proposed standard board lot size of 100 units will apply to ordinary shares, real estate investment trusts, business trusts, company warrants, structured warrants, extended settlement contracts and shares on GlobalQuote.
But board lot sizes for exchange traded funds - barring the SPDR STI ETF and ABF SG Bond Fund - American Deposit Receipts and fixed income instruments, including Singapore Government Securities and preference shares, will remain unchanged.