Vietnam bourse wants minimum trading volume at 100 shares

The Ho Chi Minh City Stock Exchange (HoSE) recently asked brokerages to comment on its plan to set the minimum number of shares in a transaction at 100 and that all transactions are done in multiples of 100.

The current minimum volume is 10 shares and transactions to be done in multiples of 10.

The stock exchange said it plans to let brokerages spend the first two weeks of next month modifying their trading systems and test out the new limits in the third week. Official implementation of the new regulation is scheduled for next January.

This new regulation is currently applied to the Hanoi Stock Exchange (HNX) and the Unlisted Public Company Market (UPCoM).

Some industry insiders have said that the proposal might be aimed at reducing the pressure on HoSE’s system with recent sessions seeing trading volume hit a record high of over VND10 trillion ($433 million).

However, the new plan is opposed by the Vietnam Association of Financial Investors (VAFI), which says it will inhibit development of the stock market by robbing new investors of opportunities to practice trading in small volumes.

The new proposal, if approved, will remove tens of thousands of small transactions from new and small investors and force them to "gamble" instead of practice investing to improve their investment skills, the VAFI said in a statement.

It asked: Will the regulation give new investors an opportunity to select quality shares with potential for price increases or will it force them to select low quality "trash" stock?

Under the new rule, college students with budgets as low as VND5 million ($217) will lose their opportunities to practice trading, it added.