ISLAMABAD: The Pakistan Stock Exchange (PSX) has successfully switched to the One-Share Lot system for investor transactions in the regular market, which is in line with international best practices for equity market investments.
According to a PSX press release received here on Monday, earlier the minimum tradable lot sizes for listed companies ranged from 20, 50, 100 and 500 shares based on their prices.
To improve investor convenience and streamline stock market transactions, this change was enacted, he said, adding PSX as a leading regulator is committed to adding value to its customer experience and facilitating investors and shareholders.
The transition to One-Share Lot started on 19th April 2024 and took place in several phases on a weekly basis to ensure a smooth and efficient transition. The recalculation was made on the basis of a comprehensive evaluation of the stock exchange.
The new lot size is expected to offer a number of benefits to investors and facilitate smooth, systematic and efficient transactions in the capital market.
Key benefits of the One-Share Lot include increased retail participation, as the smaller standard lot size makes the securities more accessible to retail investors, leading to higher liquidity and better trading volumes.
Additionally, this change allows investors to build more balanced portfolios, as those with limited capital can now afford a wider range of stocks. The new lot size also eliminates the need for investors to trade odd-lot markets at a discount, which promotes affordability.
In addition, it simplifies operations for investors and stock traders by eliminating the need to track multiple lot sizes, thereby reducing administrative and operational burdens, the press release added.
The Managing Director and CEO of PSX, Farrukh H. Khan, expressed his satisfaction with the transition and said that it is a significant step forward for the Pakistan Stock Exchange, which will especially benefit retail investors. The move to One-Share Lot is in line with international best practices and moves PSX closer to global standards where trading units consist of one share per lot, improving market compatibility, competitiveness and availability, he added.
