PSX awaits regulatory approvals to roll out new products

KARACHI: Pakistan Stock Exchange (PSX) is awaiting regulatory approvals to enhance its products’ portfolio in order to attract investors towards the recently-demutualised capital market, its chairman said on Wednesday.

“Management of the stock exchange is developing several products and some of these are awaiting regulatory approvals,” Muneer Kamal, chairman of PSX said, addressing a ceremony to commemorate the British Council’s 70th anniversary in Pakistan.

Presently, PSX offers two products as a trading platform including ready market and single-stock deliverable futures.

The bourse has already developed single options and cash deliverable futures. The existing ready market product has a limited number of participants and limited turnover as it has been less than a year since PSX listed itself as a company after offering 20 percent of its stakes to public.

Kamal, however, said market is behaving in a rational manner and new products would provide investors with choices and help in making investment decisions. He stressed the central role of the Securities and Exchange Commission of Pakistan in regulation of the capital market and the securities industry.

PSX chief said the bourse would launch the exchange traded fund (ETF) within the next three months to attract investors and broaden market scope. The ETF is a part of PSX’s plan to increase number of retail stock investors. Like an index-tracking mutual fund, ETF will allow investors to have exposure to a larger number of listed companies through a single transaction. Investors can get the benefit from any price appreciation and dividend declaration from the constituent companies.

Kamal further said the role of foreign institutional portfolio investors in the dynamics of Pakistan’s capital market has increased as their holdings have crossed 30 percent of the free float of listed companies’ shares.

Chairman PSX said the management has presented its budget proposals to the government to improve market’s performance.

Since the start of current fiscal year, the market has remained depressed shedding 6.5 percent as of March 19 due to politically-charged environment and prevailing economic uncertainty.

“If our proposals are made part of the budget it would give an impetus to the market,” Kamal added.

Rosemary Hilhorst Director Pakistan British Council opened the market with the bell ceremony.

Hilhorst said Pakistan has made incredible strides over its 70 years and “we are proud to have played our part”.

“We all know that Pakistan has immense potential and we are committed to helping young people gain the skills, opportunities and knowledge to build a thriving, prosperous country,” a PSX statement quoted her as saying.

The statement said the British Council is committed to the social and economic prosperity of the people of Pakistan. “Over the last 70 years the British Council has worked with people, institutions and governments to support Pakistan’s success.”