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Odd-lot shares’ trading to end at KSE

By Tanveer Ahmed

KARACHI: Karachi Stock Exchange (KSE) has decided to end trading of odd-lot shares in the market.

The decision was taken in the meeting of board of directors of KSE here on Tuesday. The board also took various other decisions related to stock market.

According to a director of KSE, the blocking of odd-lot shares would come into effect within one month.

Odd-lot shares often incur losses to seller as minimum buying for any scrip ranges between 50-500 shares in the stock market. In case of bonus shares or through other means, five to 15 or less than 50 shares are added in the holding of investor in a particular scrip.

However, when someone wants to sell his holding, he can only do it according to the prescribed method, which leaves him with the extra number of shares, called odd-lot.

"Odd-lot shares could not be traded in normal parameters and often settlement of these shares is done out of the prevailing system," director explained.

These odd-lot shares are also sold at lesser prices as usually small numbers of investors are interested to buy these shares.

"This decision has been taken to save the investors, especially smaller ones, from losses which they often incur in odd-lot shares," the director said.

KSE board also formed a three-member committee to solve the issue of member who has requested the board to its sell KSE card to pay off its liabilities.

According to sources, said member has been facing financial crisis since the days of floor in the stock market and has not been able to pay off its debt liabilities.

Sources estimated that the member's card could fetch around Rs 90 million, which would be much higher when card of a defaulted member was sold at Rs 55 million in January this year.

As KSE performed exceptionally well, market players pointed out, since January, the valued of card has also increased. During the peak time of KSE when it was touching new heights in the beginning of previous year, the value of membership card was Rs 130 to Rs 140 million.

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