Saturday, August 2, 2014

SGX Lots to be reduced to 100!!!

I'm serious! From CNA as well titled, "Retail investors to get access to wider range of stocks".



Click here for the official MAS press release or the .pdf version of it. It also covers the minimum share price of 20c that I mentioned in an earlier post.

So, SGX will be reducing their board lot size from 1,000 to just 100!!! This will only happen next year though! But still....

THIS IS AMAZING NEWS FOR US RETAIL INVESTORS, REJOICE!


Just a few weeks ago I wrote a post musing about lots sizes of stocks that were less than the standard 1,000. The ones that caught my eyes was Singtel, SIA and Nikko STI ETF.

Anyway, this is really really great news for all investors! Why?

1) Less capital outlay

2) Finer asset allocation
3) Increase liquidity

Basically, its cheaper access to blue chip firms that have been out the reach for many investors!

Do you know who will be the biggest benefactor of this other than just us retail investors? Standard Chartered! Since they have no minimum commission, with this small capital outlay required, I am sure that tons of retail investors will now flock over to SCB to open brokerage accounts with them!

I am sure that the other brokerages are now wetting themselves, trying to figure a way to stop the exodus. I foresee massive cuts is brokerage fees in the near future! The only bad thing that might happen? SCB starts charging a minimum fee because too many small trades might not be feasible for them!

The STI ETFs themselves might now also become obsolete, since it is now 10 times cheaper for investors to create their own portfolio mimicking the STI index without forking out that minimal expense ratio.

I am now salivating at the thought of adding a nice range of lovely blue-chips to my portfolio!

Thanks MAS and SGX for granting my wish. My next new wish now that SGX has granted me small board lots? Better ETF products available in SGD!

2 comments:

  1. Replies
    1. Yes Uncle CW8888, I think I will do that! Finally can buy blue chips!

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