THE Singapore Exchange (SGX) has been heavily bashed over the past month for either being overzealous in exercising its regulatory powers with regard to the recent collapse in penny stocks, or for not being diligent enough prior to the collapse by allowing things to get out of hand before finally stepping in.

One criticism is that had the exchange not intervened as it did when the three infamous speculatives, namely Asiasons Capital, Blumont and LionGold, crashed spectacularly last month and then stood back when Chasen Holdings and Sky One followed suit, the punting of the penny segment would have continued uninterrupted and the retail sector would be as active and vibrant as it was before October's collapse.

The rationale here is that confusion and uncertainty were created by labelling the first three "designated securities" and not the other two, and this in turn has killed interest in the entire low-priced segment because no one knows what the criteria are for a stock to be designated.