Not all sub-dollar penny stocks are sub-value
TO say that that the penny stock segment of the Singapore market has pulled back would be an understatement - crash landed and still smouldering would be a more apt description.
A liquidity-fuelled speculative (many would suspect, manipulated) party came to an abrupt end when the Singapore Exchange (SGX) finally intervened with unprecedented trading curbs on several penny stocks. This came amid a sudden downward price spiral. In the following weeks, broking houses tightened trading rules on these sub-dollar stocks, including cash upfront for purchases. The regulators are still investigating possible trading irregularities.
Not surprisingly, the net impact has been to subdue sentiment in this erstwhile vibrant segment of the bourse. Much finger pointing and debate about regulatory shortcomings has also ensued over the past few weeks.
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