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SGX mulls widening tick sizes and intra-session break

First Published 1st March 2017

Wider spreads, bigger breaks.

SGX is reportedly considering a pilot project not unlike the SEC's Tick Size Pilot Program to examine whether they should introduce more widely spaced ticks in small cap securities.

In its bid to attract more liquidity to small cap listings the exchange will hold a public consultation on the move. It's worth noting that, in the six months that the SEC pilot has been running, it has failed to demonstrate that wider tick sizes lead to more liquidity (or more accurately: to lower effective costs). In fact, the evidence points to the contrary.

In a separate issue, the exchange is also planning a public consultation on re-introducing the intra-session lunch break (which used to last an unholy 90 minutes, from 12:30 to 14:00). SGX had eliminated this in 2011 in the hope of attracting additional trading volume. However, volumes have generally dropped across the Singaporean equity market over the last decade.