The Stock Exchange of Thailand (SET) plans to introduce more measures to strengthen market supervision from the end of the current quarter to early 2025, aiming to rebuild investor confidence, according to the bourse.
Measures are divided into four groups, led by efforts to reduce abnormal fluctuations in the prices of securities, expected to be enforced this quarter.
In this group, stocks eligible for short selling must have a market capitalisation of at least 7.5 billion baht, up from 5 billion currently. The SET is also considering setting a daily short selling limit.
A central platform to control illegal naked shorting is expected to be set up by the fourth quarter, along with a circuit breaker for each stock to reduce price fluctuations that are too high.
The second set of measures is meant to tighten the supervision of inappropriate trading behaviour, such as the use of "auto halt" for individual stocks. Disclosure of inappropriate order information is set to take effect by the beginning of 2025.
Companies wanting to run high-frequency trading programs, which are popular among foreign investors and large investors, must register with the SET starting from this quarter.
To enhance the supervision of inappropriate orders and to reduce the price fluctuations of securities, an auction method is proposed for trading in three periods, including two pre-open periods and one pre-closed period.
The third set of measures is expected to increase investor protection, such as disclosure of outstanding short position transactions for each security on a daily basis, including non-voting depository receipt shareholder information, keeping investors informed about the volume of the top 10 short selling stocks. Penalties are tripled from the current level to be on par with other stock markets, also effective from this quarter, noted the bourse.
Finally, the SET board agreed with a proposal from the Association of Securities Companies to create a data exchange platform for securities companies to share information on the status of investors' securities accounts, as well as consider raising or cutting trading account limits.