Taiwan Weighs One-Share Trading as Regulator Pledges Review Within a Month
Taiwan’s standard-lot trading system currently uses lots of 1,000 shares, although investors can buy or sell a single share through intraday and after-hours odd-lot markets. A full shift to one-share trading would affect investor habits and the systems used by brokerages and the stock exchange. It could also lower barriers to investing in high-priced stocks, advance financial inclusion and bring Taiwan into closer alignment with international markets.
Financial Supervisory Commission Chairman Thomas Huang recently said the regulator would assess changes in trading habits, information-system risks and the benefits for financial inclusion. The Taiwan Stock Exchange and the FSC’s Securities and Futures Bureau believe one-share trading would support the capital market’s internationalization. Huang also pledged to issue an assessment report within one month of questioning in the legislature, when the regulator will explain whether it plans to proceed with the change.
All Coverage
2 original reportsThe Backstory
The history behind this eventTaiwan Weighs Cutting Standard Trading Unit From 1,000 Shares to One
Taiwan’s stock market has long used a standard trading unit of one lot, or 1,000 shares, leaving investors with insufficient funds to trade through intraday or after-hours odd-lot markets. The Financial Supervisory Commission (FSC) and Taiwan Stock Exchange (TWSE) are considering a shift to one-share trading to align with international markets, lower barriers to investing in high-priced stocks and promote financial inclusion. The change would also require adjustments to broker order-entry and clearing and settlement systems, as well as regulations.
The FSC recently asked the TWSE to assess reducing the standard trading unit from 1,000 shares to one and whether the existing odd-lot system should be consolidated. The exchange is expected to submit an assessment report within one month. The cost of upgrading broker systems, the timetable for regulatory amendments and investor trading habits still need to be evaluated, and no formal implementation date has been announced.
Subscribe to Mark Radar Weekly
Every Friday, the week's strongest signals in your inbox. Unsubscribe anytime.