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The Bangladesh Securities and Exchange Commission (BSEC) has ordered nine stock brokerage companies to suspend 15 traders for placing share sell orders at zero price.
“Placing sell orders at zero price is a breach of securities rules,” said Mohammad Rezaul Karim, spokesperson of the stock market regulator.
Suppose a stock price is Tk 150 but the traders place an order to sell it at zero price, then it causes a panic among investors who own such scrips and thereby affects the overall market.
Almost all the sell orders placed at zero prices were executed at their lowest value on the day.
“We sent letters to the managing directors of brokerage firms to listen to the explanations from traders and subsequently suspend them if they don’t feel satisfied,” Karim said.
The authorised representatives (traders) sold shares in bulk and most stocks were of big-capital based companies, so their influence on the index was high, he added.
The stockbrokers are Parkway Securities, Quayum Securities, Rashid Investment Services, Shyamol Equity Management, Mercantile Bank Securities, TA Khan Securities, JKC Securities, and Kazi Equities.
A stockbroker preferring anonymity said the authorised representatives trade shares in favour of brokerage firms.
“It is not possible to oversee all of the trading activities of traders,” he said while citing that the traders placed the sell orders either without knowing or unintentionally.
“The stockbrokers will have to be cautious about such activities because it may impact their reputation,” he added.
(TDS)
