Restore spreads call

THE Stock Exchange Council yesterday decided to recommend the restoration of the trading spread system as it was before July 1.

According to the stock exchange chief executive Paul Chow, the recommendation will have to be submitted to the Securities and Futures Commission (SFC) for approval before the old spread system can be restored.

The SFC is expected to convene a meeting on August 22 to discuss the recommendations.

More than half the respondents to a questionnaire, sent by the exchange for their views on trading spreads, were in favour of a restoration.

''Spread is a matter of practical operation. We have to respect members' views on this,'' said Mr Chow.

The revision was an attempt to attract investors and keep up with international market practices, which were moving towards narrower trading spreads.

As prices move faster with a wider spread than a narrower one, local traders make more profit with bigger trading spreads within a specific period of time.