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Philippine Stock Exchange New Trading Rules Effective July 26, 2010


This article is posted under General Information, Investing, News and Events.

For those who are invested or planning to invest in the Philippine Stock Market, here’s something you should know.

Effective Monday, 26 July 2010, the Philippine Stock Exchange will be implementing a new trading system with a new set of trading rules.

This is part of PSE’s commitment to enhance the trading experience and support systems for all investors, trading participants and PSE support groups.

The important changes to the Trading Rules that could immediately affect your trading activities are:

A. New Trading Schedule
There will now be a Pre-Close period prior to the Run-off Period of 12noon.

  • 9:00 AM – Pre-Open *
  • 9:30 AM – Market Open
  • 11:57 PM – Pre-Close ** ~NEW
  • 12:00 PM – Run-off / Trading at Last
  • 12:10 PM – Market Close

* At Market Pre-Open, orders can now be placed but matching will not yet occur. However, modifying and canceling orders will not be allowed.

** At Market Pre-Close, matching will freeze for three minutes. Posting new orders will be allowed. However, cancellations and modifications to orders are only allowed from 11:57-11:58 thereafter only posting of new orders are allowed until 12:00.

B. New Board Lot and Price Fluctuation Table
The new board lot and price fluctuation table for all stocks listed in the PSE are as follows:

boardlot Philippine Stock Exchange New Trading Rules Effective July 26, 2010

C. Implementation of Trading Price Limits
The price of an order shall be within the Trading Limits for the Trading day. There are two limits implemented; i.e., Static and Dynamic Thresholds.

The Static Threshold used to be known as the Floor and Ceiling Prices and is computed as follows:

  • The upper Static Threshold shall be fifty percent (50%) above the Reference price (closing price)
  • The lower Static Threshold shall be fifty percent (50%) below the Reference price (closing price)

The Dynamic Price Threshold** is computed as follows:

  • Dynamic price threshold (upper) = last traded price + (last traded price multiplied by the dynamic tick)
  • Dynamic price threshold (lower) = last traded price – (last traded price multiplied by the dynamic tick)

** An order entered breaching above or below the Dynamic Threshold will cause the security to be Frozen by the PSE stopping all trades until the PSE reactivates the security with a new Dynamic Threshold.

Example:
Stock A last traded price: P5.00 | PSE defined dynamic tick: 0.05
- Stock A dynamic price threshold (upper) = 5.00 + (5.00 x 0.05) = 5.25
- Stock A dynamic price threshold (lower) = 5.00 – (5.00 x 0.05) = 4.75

D. Closing Prices will now be calculated during the Pre-Close Period which will be similar to pre-opening calculations of the opening price.
Noon time will bring about a closing price that will match pre-close posted orders then continue trading at the closing price until 12:10.

E. Partial matching of Odd-lot orders will now be allowed.

F. Good-Till-Cancelled orders will now cover a period of seven (7) calendar days instead of seven (7) trading days.

For more information regarding these rules, you may contact your stock broker or visit the Philippine Stock Exchange website.

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If you have no real idea how the stock market works, maybe you could read this two-part article I wrote before:

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This entry was posted by on Monday, July 26th, 2010 at 1:56 am and is filed under General Information, Investing, News and Events. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site. If it's your first time to comment here, your post could be held for moderation and won't appear until approved. Off-topic responses and self-promotion posts can and will be deleted.



15 Responses to “Philippine Stock Exchange New Trading Rules Effective July 26, 2010”

  1. Glenn V. Esber on July 26th, 2010 at 10:27 pm

    I’m OFW, I want to learn about investing in the stock market.

  2. Hi Glenn. Don’t worry. I will write more about investing in the stock market here. So just come back often so you won’t miss my posts on it. Thanks!

  3. Hi Sir Fitz! Thanks for this chance. I’ve filed up your Survey Form. I want to take advantage of this FREE education. I’m excited to learn more from this.

  4. I am already engaged in online stock trading. However, I still don’t have much knowledge in managing my stocks. Please post some ways on how to earn in capital markets. Thanks!

  5. pleasant day.
    I would like to know how much commission will the stock broker get when I buy ? and when I sell?

    I plan to do stock trading again and I want to know certain critical rules.

    Upon placement, when must I pay?

    many thanks

  6. Hi Fitz,

    I want you to know how awesome you are and on how you helped me create my financial plans. Kudos to you and to your blog!

    I’m just wondering if you could recommend any online games that simulates how the stock market works (e.g. Fantasy Earnings Trader, . I found a couple of games on the internet but I want to know if you have something cooler in mind. Also, i read one of your articles about “doubling” (can’t remember the exact title). You mentioned something about learning Visual Basic programming and that you created softwares from it. Did you sell any of your creations? I’m exploring the possibility of making applications but I have no background in IT and computer science. In fact, I graduated with a Psychology Degree.

  7. Ano po ibig sabihin ng board lot?

  8. Hi Jeffrey, multiples of the board lot lang ang pwede mong bilhin.

    For example, if the price of company ABC is P40, then the board lot is 100, which means the number of shares you can buy should be a multiple of 100 (100, 200, 300 etc.).

    If the price of ABC suddenly reaches P50, then the board lot becomes 10, which means you can now buy multiples of 10 shares, like 10, 20, 30, etc.

    But if the price goes down to P49, then the board lot becomes 100 again, so you can’t buy 10 shares anymore, the minimum becomes 100 shares again.

    I hope my explanation was clear.

  9. Hello Sir Fitz,

    Good Day!

    I started to invest in the stock market a few days ago…
    Im focusing on stock ABC which is 32Php with a board lot of 100.
    5k per month.I bought 100 shares which is equal to 3200Php.I still have an extra money of 1800Php.

    My first question is will it allow me to buy 150 shares which is equal to 4800Php even if the board lot is 100? kasi po diba board lot is the minimum number of shares that you can buy?.

    Second is if not will it be good if I’ll just buy the 50 shares on the odd lot to maximize my 5k?

    Kasi Sir if the price of the stock goes up with my 5k I can only buy 100 shares per month then a lot of extra money will be left.

    Thanks a lot for your help Sir Fitz. It will be really appreciated :)

  10. Hi Koko.

    Board lot means you can only buy multiples of that number for that stock. And if you can, yes you can buy an odd lot to maximize your budget.

    If you’re buying P5k worth of the stock monthly, then maybe you can change your cost averaging strategy and just buy P10k worth of the stock every two months.

  11. Hi Fitz,

    I am a newbie in trading stocks, and reading your blog is the most helpful, and clear. I have no experience in trading yet, so here’s my question.

    If I buy my shares, how do I sell them? Example I bought ABC for Php40 with a board lot of 100, should I sell all of these 100 shares in a day, or how is it?

    Thanks and I appreciate your reply in advance!

  12. Hi Marj,

    You sell your stocks through your stock broker. I recommend that you sell them after several years, because that’s how you invest in the stock market.

  13. hi Fritz,

    so is this the same when I use the citiseconline website for maintaining the stocks? Thanks again

  14. Yes Marj. You sell it through COL.

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