Contra risks best left to brokers

THE controversial practice known as contra trading has been under scrutiny ever since the penny stock crash of last October. Because of claims (as yet unproven) that contra was a contributory - or perhaps aggravating - factor during that sorry episode, there have been calls to either abolish or curb the practice

because allowing punters to buy stocks with no capital upfront is outdated, risky and encourages gambling.

The authorities last month proposed various new measures aimed at strengthening the local market. These include proposals to curb contra - a shortening of the settlement period to two days instead of three, and the payment of upfront collateral.