MTP is necessary to push companies to do better

IT is not true that the minimum trading price (MTP) for Singapore Exchange mainboard shares works to the detriment of penny stock issuers and retail investors. (Minimum trading price rule seen working against share issuers, investors, BT, May 6.) The US markets have such a minimum trading price, and they are none the worse for it.

In fact, the Catalist board should also have a MTP, albeit lower than that for the mainboard.

It is absurd and illogical not to have an MTP, which is tantamount to a stock trading at the tick size (in our market, it is S$0.001) at its very low point. Without MTP, there is no incentive for the management of a listed company to perform better.