NGX Unveils New Trading Framework for Stock Prices

The Nigerian Exchange (NGX) has launched a new trading framework aimed at adjusting stock price movement methodologies. This framework introduces a three-tier volume system for share price movement, reverting to a structure last seen in 2018.

The new rules will set minimum trade volume thresholds for price changes, with specific requirements based on stock price. Stocks priced above N1,000 will require a minimum of 10,000 shares to trigger price movement, while those priced between N500 and N1,000 will need 50,000 shares, and stocks below N500 will require 100,000 shares.

This change is expected to enhance price stability and mitigate the impact of low-volume transactions, particularly for highly priced equities. However, traders have expressed concerns that the new thresholds may reduce price responsiveness for less liquid stocks.

The policy comes amid increased regulatory scrutiny in the Nigerian capital market, which continues to attract more retail and institutional participation. Aruna Kebira, Managing Director of Globalview Capital, commented on the new requirements.