This is old news, but I think it is good to highlight some details here. Singapore Exchange (SGX) has reduced the minimum bid size for securities on 4 July 2011, leading to lower trading costs for investors.

To cater to the narrowing of the bid sizes, SGX will widen the Forced Order Range for all securities to +/- 20 bids from +/- 10 bids across all price ranges. Forced Order Range is a pre-execution mechanism which helps investors to avoid error trades when entering prices of orders. Any orders outside the Forced Order Range must be confirmed by the use of the Forced Key function before those orders can be submitted.

The revised Minimum Bid Size and wider Forced Order Range will apply to all securities traded on SGX except exchange traded funds, loan stocks and bonds.

Please refer to Appendix 1 for details of the changes and Appendix 2 for an illustration of cost savings for investors.

Appendix 1

Details of the changes are as follows:


Price Range (S$)ExistingNew
Bid Size (S$)Forced Orders (Bids)Bid Size (S$)Forced Orders (Bids)
Below 0.200.005+/- 100.001+/- 20
0.20 – 0.9950.0050.005
1.00 – 1.990.010.005
2.00 – 9.990.010.01
10 and above0.020.01


SGX is also revising the Minimum Bid Size for debentures.  Details of the changes are as follows:


Price Range (S$)ExistingNew
Bid Size (S$)Forced Orders (Bids)Bid Size (S$)Forced Orders (Bids)
All0.001+/- 300.01 or 0.001 as determined by SGX-ST+/- 30


Appendix 2

Cost savings to investors who buy or sell for an estimated $50,000 transaction:

CountersNo. of Shares*Existing SpreadNew SpreadExisting Spread Cost*Savings ($)*% Savings*
STI 3150BNPeCW110629294,0000.0050.001$1,449$1,1552.31%

* Based on approximately $50,000 notional value


For Cosco
Current bid/ask                       :           $1.95/$1.96
Revised bid/ask                      :           $1.950/$1.955 or $1.955/$1.960

Savings for buyer                   :           $127
Savings for seller                    :           $127
Total savings for investors      :           $254

Source: SGX Website.

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Ivan Guan is the author of the popular book "FIRE Your Retirement". He is an independent financial adviser with more than a decade of knowledge and experience in providing financial advisory services to both individuals and businesses. He specializes in investment planning and portfolio management for early retirement. His blog provides practical financial tips, strategies and resources to help people achieve financial freedom. Follow his Telegram Channel to join the FIRE community.
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