Egypt’s stock Exchange (EGX) announced in a statement on Sunday that it would lift the limit on intraday share price moves to 20 percent starting from September,
The Egyptian bourse currently limits moves in share prices to 10 percent either up or down, after which the share is suspended. The 10 percent limit has been placed in place since February 2011 under measures introduced by Egypt’s Financial Regulatory Authority (FRA) to safeguard the financial market from violent fluctuations after the 2011 uprising.
The new methodology uses a 30-minute moving-volume weighted average price (Moving VWAP) instead of the current VWAP methodology, which takes into account all the traded volume throughout a daily session to determine the closing prices of shares, the EGX said in a statement on Sunday.
The EGX will also introduce the trade-at-close session which allows participants, after a closing price is determined, to trade securities at that closing price during the last 30 minutes of the session.
These amendments are expected to improve the accuracy of closing prices and boost institutional investments in the EGX.
