Investors enraged as HCMC stock exchange's broken trading system causes losses

By Minh Son   June 9, 2021 | 06:57 pm PT
Investors enraged as HCMC stock exchange's broken trading system causes losses
Investors at a brokerage in District 1, HCMC. Photo by VnExpress/Quynh Tran.
HCMC’s unstable stock market system and slow response in the last few months have meant traders are unable to transact at their desired prices, causing losses and mounting frustration.

"What is wrong with the system?", "Why is my order not executed?", "Could you cancel my pending sell order? The price is plunging but the order has not been executed," are questions constantly asked of Thu Hang, head of the consulting department at a brokerage as the overload on the Ho Chi Minh Stock Exchange (HoSE) worsens.

Hang has not been able to leave her phone during trading hours since the start of this week because frustrated investors vent their anger on their brokers. Some even demand compensation for their losses.

HoSE shut down trading for the first time ever on June 1 as a surge in trading during the morning session overloaded its system.

The problems continued on June 2, and some brokerages requested traders to refrain from canceling and modifying orders to avoid overloading the system.

Hang said: "Each buy and sell order directly affects investors financially. The stock market fluctuates rapidly, huge changes can occur within a minute, and many orders are not executed for 15 minutes. Therefore, it is understandable that investors are frustrated."

She has no idea how to calm down investors and can only explain that her brokerage can do nothing about the system overload.

Thanh Tung, an investor of six years, said never before has placing orders caused so much frustration.

Normally, orders are sent instantly to the system, but on Tuesday, when he decided to sell some bank stocks since they were losing, his order was not executed for 15 minutes, and the stock price continued to fall.

He modified his order to sell at market price, which means the trade is normally executed immediately at the highest price someone is willing to pay. But he still had to wait for nearly 20 minutes for the order to be executed, and by then the stock price had almost hit the floor.

Besides, incorrect results and ask and bid prices are shown on the trading boards, and investors cannot make optimal decisions.

Hung said: "When an order is executed, stock prices already differ by a few percent, leading to losses for investors. If the trading system operates smoothly, there will not be such price differences."

On many stock trading forums, people have called for stopping stock trading so that the system could run smoothly again.

The trading system, which has remained mostly unchanged for the last 20 years, has been overwhelmed since investors seeking greater returns than bank deposits have flocked to it.

The number of new stock trading accounts opened by retail investors in May topped 113,670, a new record, according to the Vietnam Securities Depository.

May was the third month in a row in which more than 100,000 accounts were opened.

There are 3.2 million retail and 12,000 institutional accounts now.

Solutions such as disallowing cancelation and modification of orders can only be temporary, and the only hope is the new stock trading system which is under development by IT giant FPT and expected to start operating in early July.

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