THE Philippine Stock Exchange Inc. (PSE) said it is adjusting the floor that stocks can go decline in a day to 30 percent of the previous closing price, from the current 50 percent, as a means to manage the volatility in the market.
This will take effect Tuesday, March 24, 2020.
The PSE said it has received the required approval form the Securities and Exchange Commission for the measure.
“We are looking at measures to address the present volatility in the stock market due to uncertainties from COVID-19. One of the measures we decided to adopt is to tighten the trading band for securities,” Ramon Monzon, PSE president, said.
“We benchmarked the adjusted lower static threshold level with what other exchanges in the region currently implement, which is between 10 and 30 percent,” he added.
Monzon said the PSE has already configured its trading system “to recognize a 30 percent decline in share price as the floor price of a security.”
The upper static threshold of securities will remain at 50 percent.
