The Colombo Stock Market (CSE) is now in the process of introducing a new trading system, which would be trading both equity and debt market on the same platform. This would enhance the efficiency of the market, its sources said.
“With the introduction of one platform to trade both equity and debt on one platform, corporate entities and individuals could trade on the same platform without any problem and with much convenience,” CSE Head of Marketing Niroshan Wijesundera told Daily News Business.
He said that this would also help companies to raise capital through the debt market without going for an Initial Public Offering (IPO) or introductory offering, which certain companies are reluctant to because it would lose the controlling stake of the company. He also said that CSE became the best performing capital market in the world recording a growth of 111.14 percent. All Share Price Index (ASPI) of the CSE and Milanka Price Index (MPI) both had crossed the 7,000 milestone creating history.Wijesundera said that from next year onwards the CSE would remove the MPI, which duplicates the Sri Lanka 20 (SL20) Index, which also consist of 20 most liquid companies in the market, which contributes 52 percent of the market.
Therefore, MPI is not reflecting the correct picture with comparison to the SL20, he said. Once the new one platform trading system is introduced to the market this would help all stock market traders to trade in one platform with a lot of convenience.
The CSE has facilities for the secondary trading of corporate and Government Securities. A separate trading system (DEX) and a separate clearing and settlement mechanism is in place for debt securities. Presently 69 corporate debt securities are listed on the CSE.
All Government Debt is tradable through the DEX system. Institutions incorporated outside Sri Lanka and individual’s resident outside Sri Lanka inclusive of Sri Lankan residents out side Sri Lanka will help to buy and/or sell shares in a listed company in the market up to 100 % of the issued capital of such company.