In a statement yesterday, Bursa said the change to Day Order from the current Session Order will increase efficiency and meet market expectations.
“With the implementation of Day Order, all unmatched orders from the morning session will be automatically carried forward to the afternoon session and shall be considered as valid for the whole trading day. Brokers are only required to manually cancel the orders after 2pm if they do not wish to carry the orders into the afternoon session,” it said.
Under the current Session Order, all orders entered into the trading system are valid for a single session only, as all unmatched orders are cancelled by Bursa immediately after the end of the morning session. Thereafter, brokers are required to key in their orders again in the afternoon session at 2pm when the market re-opens for the pre-opening phase.
“In line with the implementation of Day Order, a single trading limit shall be applied for the whole trading day. The single trading limit will be at 30% or 30 sen,” it said.
Brokers said the new trading limit of 30% will be good for the market as it reduces volatility and speculative elements.
Bursa Malaysia's new Day Order is aimed at improving market efficiency.
“The new Day Order also improves the efficiency as remisiers would not have to re-key in their orders in the afternoon session. However, I am not certain if it will attract more retail investors,” said TA Securities’ head of research Kaladher Govindan.
His view is shared by Maybank Investment Bank’s head of retail research Lee Heng Gooi.
“The single trading limit is certainly a boon for the market as it limits the risks for retail investors who are caught in a speculative move. Prior to this, investors could see their gains wiped out to a maximum of 60% in a day, but now it is limited to only 30%,” he said. - by Max Koh of theedgemalaysia.com
what is dayorder?
ReplyDeletedefinition of day order - A buy or sell order which automatically expires if it is not executed during that trading session .
ReplyDelete