SGX to scrap block trades provision
Wednesday 4 January 2012 - by Karina Whalley
The so-called "engine-level iceberg order functionality" was created for investors who trade in large quantities, but the SGX says it is little used as there are already alternative execution tools available for block trades.
However, brokers' order management systems as well as automated execution desks that are used for making block trades can also "splice" them into smaller orders before they enter the trading engine. The Singapore Exchange believes traders are using their own systems for doing this.
In November last year, engine-level iceberg orders accounted for less than 0.0001 per cent of the total number of orders made in both the securities and derivatives markets and about 0.001 per cent of total trade volume.
The consultation paper is open to the public for comment until 16 January and, subject to approval by the Monetary Authority of Singapore, the Exchange wants to have the provision abolished within the next three months.
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