The Karachi Stock Exchange (KSE) has added two further two sub-clauses to its existing short selling regulation, which will allow market participants to execute their short sale orders without any price check (Uptick or Zero tick). The clauses were added with prior approval of the Securities and Exchange Commission of Pakistan (SECP), said the KSE.
Currently, short sales on the open market take place on the Karachi Automated Trading System (KATS) and are only allowed with a price check.
Under the amendments, short sale orders will be allowed without price checks in the following circumstances:
– Short sales by a single universal identity number (UIN) will be allowed for a maximum of 2% of average daily turnover of the respective stock of the previous month.
-A member of that UIN, including their client positions, will be allowed to execute a short sale for a maximum of 4% of average daily turnover of the respective stock of the previous month.
– All market members on cumulative basis will be allowed to executve a short sale for a maximum of 40% of average daily turnover of the respective stock of the previous month.
A mock session will be available for KSE members on Feb. 4, 2012 while the live system will be effective from Feb. 6, 2012 through KATS.
(JDC)