Stock exchange upgrades trading system

Thursday, Apr 11, 2013 15:28

HA NOI (VNS) — The Ha Noi Stock Exchange will adopt an upgraded system for transactions this quarter that includes innovations like At The Close Order (ATC).

ATC prevents the manipulation of closing prices by changing the way the closing price is determined, in line with international standards.

In the new system, the closing price will be the price that generated the greatest trading volume, rather than the last transaction price.

The new system will also have a much higher processing capacity "suitable for both listed and unlisted markets and even futures markets," according to a representative for the exchange.

The system can handle up to 20-30 million orders in a single session, simultaneously fixing them at a frequency of 15,000-20,000 orders per second – more than 10 times the current capacity.

The system will also add various types of orders such as market pricing, stop orders (which investors commonly use before leaving for holidays or entering a situation where they are unable to monitor their portfolio for an extended period) and iceberg orders (orders divided into smaller lots for the purpose of hiding the actual order quantity).

By hiding its large size, the iceberg order reduces the price movements caused by substantial changes in a stock's supply and demand. Other special techniques used in foreign markets will also be applied.

The system is currently in its test run with the Viet Nam Securities Depository and securities companies. Over 92 members have registered to join the pilot. — VNS

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