SGX chairman defends bourse as liquidity reforms take effect

The Singapore Exchange will implement changes to its trading structure next week, lowering the standard board lot size from 100 units to 10 units for 11 listed companies. The reduction is intended to make shares more accessible to retail investors and potentially enhance trading activity in these counters.

SGX's chairman has responded to criticism regarding market liquidity, asserting that the exchange itself cannot be held accountable if stocks lack sufficient trading volumes. The remarks come as the bourse seeks to balance concerns from market participants about the depth and breadth of liquidity available in certain securities.

The board lot reduction represents one of several initiatives the exchange has undertaken to attract participation and streamline market operations. By lowering the entry point for individual investors, SGX aims to broaden the shareholder base for the affected companies and encourage more frequent trading.

The 11 companies subject to the change have been selected based on criteria including market capitalisation and existing trading patterns. Market participants will need to adjust their trading systems and processes to accommodate the new lot size structure when the changes take effect on October 5.