Re-introduction of Odd Lot Market – Alfalah Securities Limited

Karachi, June 21, 2012 (PPI-OT): As per the KSE Notice, the Odd Lot Market is scheduled to be reintroduced from July 23, 2012. The board of Karachi Stock Exchange has approved two Cash Markets comprising of a Ready Market with Marketable Lots and a separate Odd Lot Market.

According to Alfalah Securities Limited, the marketable lots will be of 500 shares for stocks having price of upto PkR 100 per share. Likewise, 100 shares lot will be for shares priced between PkR 101 and PkR 500; 50 shares lot for shares priced between PkR 501 and PKR 1,000 and for share having above PkR 1000 will be traded at a Marketable lot of 20 shares. These lots would be reviewed on bi-annual basis i.e. on June 30 and Dec 31 each year where NCCPL will be required to notify 30 days in advance.

In case of Odd Lot Market, trading with be done on Time-Price priority and the trader can trade up to 1 less share of the marketable lot of the said stock. The circuit breakers (CBs) have been widened to PkR 2.0 or 10% whichever is higher based on the previous day’s closing price in the ready market. Moreover, on listing of Exchange Traded Funds (ETFs), the securities included in the formation of ETFs will be allowed to trade in marketable lots of 1 share multiple after giving a 30 days’ notice to the market participants.

This measure is taken to improve the liquidity situation in the market and enhance operational efficiency in the exchange. The investors would be provided an option to trade in lots as well as separate odd number of shares which will also add convenience to investors who otherwise had to book trade of even one share, if executed, which used to create inefficiency in the system.