USE to increase trading days next year
Posted Friday, December 31 2010 at 00:00
Starting January 2011, the Uganda Stock Exchange will open for business five days in a week, in line with other major regional markets Daily Monitor has learnt.
Currently the trading floor opens only on Monday, Tuesday and Thursday, between 10am and 12pm. This makes it impossible for investors to either buy or sell their shares on Wednesday and Friday.
Mr Joseph Kitamirike the chief executive officer, Uganda Securities Exchange said; “We are going to expand to five days and then to two sessions per day.”
He attributed the development to increased demand for shares at the exchange, regional integration and the desire to ease trading for investors. “It’s just to give an opportunity for people to trade. People sometimes make their decisions on Tuesday but they have to wait until Thursday to trade,” he told Daily Monitor in an interview on Wednesday.
The expansion in trading periods is also meant to upgrade the USE to the level of the Nairobi Stock Exchange and the Dar es Salaam Stock Exchange which has been busier compared to Uganda’s market. “We cannot keep our market closed on days when we can be trading across the border. If your market is closed and the others are open then investors who come through your market don’t have access to others,” he said.
The four stock markets including the Rwanda Over the Counter Trade are operating in the East African Community (EAC) Common Market and are set to have similar regulations and operational procedures as they integrate.
The Common Market came into effect on July 1, 2010, giving way for the free movement of capital, labour, goods and services.
Although this has largely remained a theory for most businesses, the USE and ROTC have witnessed cross listings of shares of companies like the Nation Media Group, and Kenya Commercial Bank which are listed on the NSE.
Through the collaboration and integration of the four markets, Mr Kitamirike said the USE is trying to enable local investors to trade across the border.
With time, the expansion of trading days and sessions is expected to result into higher trading volumes and turnover. “If investors like the market and have the securities, then the volumes will go up but right now we want to provide the opportunity.”
To further ease domestic and cross border trading of listed company shares, the USE will next year automate trading at the stock market. This will enable investors to place their orders at the exchange.