Friday, March 29, 2024

NSE amends per value and pricing methodology rules

The Nigerian Stock Exchange, on Friday, concluded all arrangements to amend its per value and pricing methodology rules.

In an information made available to our correspondent, the Exchange said that the set of rules could be found in the Exchange Rulebook 15.29 and 15.30 respectively, of 2015 (Dealing Members’ Rules) which have been approved by the Securities and Exchange Commission.

The NSE noted that the amendment of these rules, specified the revised price limit, price movements, adding that  it “ticks sizes of price, ensures minimum pricing increments and the minimum quantity to be traded that will change the published price.” It said it would become effective on January 29, 2018.

“The rules also classify equity securities into different price groups in order to achieve this. These revised rules will be implemented on NSE trading room on the effective date. The amended stratification of price movements, price limits, and the ticking of sizes aim at improving liquidity, narrowing spreads, and ensuring that all price improving (up/down) transactions are making the market more efficient for all participants,” it further said. 

In order to achieve the success of the rules, the Head of Department, Market Surveillance and Investigations Department, Mr. Abimbola Babalola, said, “The new Group “C” consists of equity securities that are priced below N5.00 per share, for at least four of the last six months or new security listings that are priced below N5.00 per share at the time of listing on The Exchange.

“Market participants are also informed that the new Per Value Rule specifies that the price of every share listed on The Exchange shall be determined by the market forces and that the equities may now trade below the erstwhile price of 50 Kobo per unit.

“Therefore, traders are required to ensure that as from the above stated effective date, all open and subsequent price orders in equity securities comply with the amended requirements for each price group of equities and in approved minimum increments accordingly.”

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