Too early to judge impact of smaller board size

THOSE sceptical of the Singapore Exchange's (SGX's) move to reduce the board lot from 1,000 to 100 shares might think not a lot has changed after the first day's trading volume amounted to just 1.2 billion units worth S$897 million, a fair bit lower than last week's average daily of S$1.13 billion.

However, SGX said after the market closed that there was appreciable demand for 100-share lots of the highest-priced counters such as those from the Jardine group, Keppel and the banks. Also, despite the expected lower turnover here on Monday because of the Martin Luther King (MLK) day in the US, the turnover of S$897 million was still 4 per cent higher than the S$862 million seen on MLK day in 2014.

It's a modest start but encouraging nonetheless. The move, however, is not without its sceptics. Negative feedback so far has focused mainly on high broking fees as being a trading barrier for retail players. As it stands now, the minimum commission and various fees of around S$25-30 per transaction makes it financially prohibitive for small investors to trade in many of the lower-priced issues.