MANILA - The Philippine Stock Exchange is seeking public comments on the proposed rules allowing investors to trade online without the need for brokers.
"The proposed Direct Market Access Rules seek to provide the regulatory framework for the provision by Trading Participants of DMA services and lay down certain requirements that Trading Participants and clients must comply with in order to address the potential risks associated with DMA trading," the bourse said in a memorandum.
The deadline for the submission of the comments on the proposed DMA rules is on September 7.
The proposed rules cover the requirement for providing direct market access services, system certification and re-certification, security system, restrictions on the use of the facility, responsibilities of a DMA trading participant, risk management protocols, among others.
In June, the local bourse sealed an agreement with N2N Global Solutions Sdn. Bhd., a wholly-owned subsidiary of Malaysian-listed securities trading solutions provider N2N Connect Berhad, to promote online trading and direct market access to trading participants.
N2N will offer the software solution allowing the PSE to offer online trading for trading participants' clients who want to execute and monitor their own orders; trading terminal for dealers/traders and TPs' more sophisticated clients; and direct market access with automated order taking facility and algorithm trading for TPs' clients who want fast execution of orders.
Through the DMA facility, a client of a TP with this service is directly connected to the trading engine of the Exchange and can experience lower trade latency. This will eventually open the market for high-frequency trading, which uses algorithmic and other like strategies.
Such schemes account for 30 percent of trading in other Asian markets and for 70 percent of trading volume in the US.
source: interaksyon.com
