ASCO to ask for raising minimum trading volume for fully negotiated commission

"If the sliding scale regime starts next year and the minimum volume for full negotiations (between brokerages and investors) remains unchanged at Bt20 million as set by the SEC, securities houses with large customers will feel the pinch from falling commission income," Asvini Tailanga, managing director of Thanachart Securities, said yesterday.

"Our company would not be hurt much, as almost all of our big customers have trading volumes around Bt1 million to Bt10 million," she said.

With the sliding scale, commission rates will be set at 0.25 per cent for trades under Bt1 million, 0.22 per cent for Bt1 million-Bt10 million, 0.18 per cent for Bt10 million-Bt20 million and fully negotiated for more than Bt20 million.

The sliding scale will start on January 1 and run for two years until commissions become fully deregulated. At present, the minimum commission is set at 0.25 per cent for traditional orders and 0.20 per cent for online trading.

The association is studying the impact from setting higher volumes and the result will be forwarded to the securities watchdog, she said.

The appropriate volume for full negotiations should be at least Bt30 billion a day, she said.

All brokerages in the second quarter should be profitable because daily volume had jumped to about Bt25 billion from Bt8.5 billion in the first quarter, she said.

The average daily trading volume in the remaining two quarters of this year would fall back to Bt15 billion but lift the average for the full year to Bt14 billion, she said.

Faced with thin trading volume in the first quarter, almost all securities firms plunged into the red, as stock commissions are their main source of income.

Meanwhile, Patareeya Benjapolchai, president of the Stock Exchange of Thailand (SET), forecasts 12 companies seeking a listing next quarter, with more than half of them choosing the SET instead of the Market for Alternative Investment.

The SET estimates that 37 companies would list on both boards this year.

This is the right time for stocks to debut as trading volume and liquidity have increased since last month, she added.