Thai stock exchange to tighten short-selling and high-frequency trading rules from November

The Stock Exchange of Thailand announced a suite of rule changes effective November 16 to improve market stability, liquidity and investor confidence. Stocks priced from five to 50 baht will trade in finer price increments, a step intended to tighten bid-ask spreads and lower transaction costs. Short-selling will be confined to the most liquid instruments, including SET100 constituents, single-stock futures, depositary receipts and ETFs, and must be executed at a price equal to or higher than the last trade.

The exchange will levy extra fees on accounts that generate a high volume of orders but achieve few executions, and it will eliminate dynamic price bands and minimum resting-time requirements to ease trading barriers. Restrictions on what high-frequency traders can buy and sell will be relaxed, and morning sessions for derivative warrants and foreign-linked ETFs will start at 8 a.m., two hours earlier than before, while closing times stay the same. These measures received approval from Thailand’s Securities and Exchange Commission after a public consultation.