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Expanding the scope of intraday trading mechanism to include a larger number of listed securities

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•El-Nashar: FRA allows using the intraday trading mechanism for securities listed in List (B) of specialized activities standards

Within the framework of adding new mechanisms and increasing liquidity in the Egyptian Stock Exchange, FRA has approved a proposal by the Egyptian Stock Exchange to activate intraday trading mechanism for securities listed in List (B) of specialized activities standards.

Judge Khalid El-Nashar- FRA’s Deputy Chairman has revealed that the proposal of the Stock Exchange has been discussed and submitted for dialogue with Capital Markets parties represented by the Egyptian Capital Market Association – ECMA and the securities division of the Federation of Egyptian Chambers of Commerce, in addition to FRA’s Advisory Committee in order to contribute in the process and shed light on the proposal’s positive aspects.

El-Nashar added that the Authority has agreed to activate intraday trading mechanism on securities listed in list (B) of specialized activities standards, giving brokerage companies the right to determine the list of securities to be traded using this mechanism.

It should be noted that the second list (B) according to the beginning of the trading session dated 2 September 2018 was consisted of 56 securities where buying on margin was allowed. In addition, the securities would be accepted as collateral up to 80 percent of their market value in accordance with the following criteria, where the minimum market capitalization of free shares shall not be less than 0.00005 of the total market capitalization of free shares during the period of examining the market. In addition, the number of trading days on the share shall not be less than 75% of the total number of actual trading days in the market during the period under review. 
 Also, the average daily number of brokerage firms operating on the stock should not be less than 3% of the daily average number of brokerage companies traded in the market during the period under review.  Moreover, the daily average number of dealers per share shall not be less than 0.1% daily number of dealers in the market during the period under review.

In addition, the share turnover ratio shall not be less than 10% during the period under review. Also, the average daily trading volume of the share shall not be less than 0.0005 of the average daily trading volume of total shares.
 

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