SEC: More speculation curbs likely

SEC: More speculation curbs likely

The Securities and Exchange Commission (SEC) will come up with new measures to clamp down on speculation if its latest move fails to curb overheating.

Secretary-general Vorapol Socatiyanurak said the latest measure will extend the cash-advance trading period for stocks with high turnover to six weeks from three, effective from today..

He said the SEC will monitor market feedback if speculation remains at a level that could harm investors, as many stocks were trading heavily until their price-to-earnings (P/E) ratios had skyrocketed far from their fundamental value.

More than 70 stocks on the SET100 are trading with a P/E ratio higher than 70 times.

"The SEC is worried that new investors who have no experience in the stock market will become victims when a market correction causes prices to decline sharply," said Mr Vorapol.

Mr Vorapol declined to give details of possible new measures if the latest one fails to bring results.

He said the SEC found that some investors have tried to make as much profit as possible by opening trading accounts with several brokers. By doing so, they can change their portfolios easily to place more orders.

The agency has asked the Association of Securities Companies to monitor its members' behaviour closely, especially members involved in heavy trading of hot stocks.

The SEC also requires brokers to provide research on stocks that their houses have traded heavily.

During the stock market boom, most securities firms' margin loans have reached the limit.

TSFC Securities Ltd, which provides securities borrowing and lending services, said it had stopped providing credit for margin loans temporarily since Tuesday as its outstanding margin loans now stood at 3.5 billion baht, close to the warning limit set by the SEC.

The SEC, the Thai Investors Association (TIA) and the Listed Companies Association have arranged a programme to protect shareholders' rights.

The TIA will send 40 volunteers to attend annual shareholder meetings of listed firms in April, especially those trading non-SET50 stocks.

The meeting results will be published on the TIA website. Where necessary, it will file evidence to the SEC.

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