Home   >   Markets   >   201208   >   Pre-trading on bourse not bad practice – GSE


Pre-trading on bourse not bad practice – GSE
 
Posted on: 21-Aug-2012         Source: GNA
 
 
 
Pre-trading on the Ghana Stock Exchange (GSE) before the official trading on the bourse is not an illegality, contrary to some speculations in a section of the media.

Mrs Elizabeth Mate-Kole, General Manager of Operations at the GSE, who made this known on Tuesday, during a day’s capacity-building workshop for members of the International Federation of Economic Journalists (IFEJ), in Accra, said pre-trading was a normal practice among many nations.

She stressed that the daily pre-opening period for trading was to allow the previous day’s surplus to be put on the stock to be traded.

Mrs Mate-Kole was reacting to a statement made by Mr Kwabena Situ, a Senior Audit and Advisory Manager of Deloitte Ghana (DG) during a workshop organized on July 31st, by his outfit and the Association of Chartered Certified Accountants, Ghana, which suggested that the GSE’s pre-trading operations, was not in conformity to global stock exchange trading standards.

Mr Situ was of the opinion that the pre-trading exercise had the tendency to distort prices on the bourse since, according to him, the price a company closed its trading activity on the previous day was different from what it begun its operations with the following day.

Mr Situ suggested that the price changes had the potential to mislead an investor.

He suggested that pre-trading needed to be discontinued since it was not done anywhere in any active trading platform in the global financial industry.

The GSE runs a daily pre-opening trading session that boosts liquidity before the official opening at 10:00 hours.

It is suggested that the time also affords non-resident investors in different time zones the opportunity to do business with their local brokers.

Mrs Mate-Kole called on journalists to research and verify whether pre-trading was an illegality.

Mr Ekow Afedzie, Deputy Managing Director of GSE, said the activities of the bourse were overseen by the Council as well as the Security and Exchange Commission.

He called on journalists to focus their reportage on how to generate activity on the stock exchange and how to encourage more companies to enlist on it.