No collateral needed for retail investors to trade

Regulator decides against implementing 5% collateral on open stock positions mooted in 2014 consultation paper

Angela Tan

Published Wed, Feb 19, 2020 · 09:50 PM

Singapore

THE Monetary Authority of Singapore (MAS) has decided it will not need retail investors to pledge collateral on their open stock positions.

MAS said it has assessed the combined market impact of all the initiatives that have been implemented since 2014 to improve market functions and trading practices in the securities market here.

"Given the lower level of risk associated with contra trading and the new measures implemented to improve risk management practices in the industry, MAS has assessed that there is no need to introduce collateral requirement for the trading of listed securities under current market conditions," the regulator said.

Stock brokers and remisiers welcomed the decision. They had expressed concern over a proposal in a 2014 SGX-MAS consultation paper for retail investors to stump up a sum equi…