ll listed securities on MSE are traded through Exchange’s electronic trading platform in the Trading hall. The brokers enter all orders into the computer network located in the trading hall. The orders are automatically matched and executed.
Once transactions have been completed the results are transmitted immediately to the broker’s computer systems. MSE monitors the market and supervises transactions in the MSE trading hall.
The securities trading at MSE administered using two different auction methods: continuous auction and auction.
Continues auction is where buy and sell orders interact with one another. All orders are placed by member Broker dealer companies and matched in accordance with the price priority and time priority rules. Under the price priority rule, a selling (buying) order with the lowest (highest) price takes precedence. Under the time priority rule, an earlier order takes precedence over others at the same time. The transaction is executed at the price, when buying and selling are matched at the same price.
Trade flow and mechanism
In auction trade buyers enter competitive bids and sellers enter competitive offers at the same time. The price of the security is traded represents the highest price that a buyer is willing to pay and the lowest price that a seller is willing to sell at. Matching bids and offers are then paired together and the orders are executed.
Securities trading and its types
Two types of securities traded over the MSE these are: stocks and bonds.
Following types of trade conducted using continues auction method:
- stock’s primary market trade
- stock’s secondary market trade
- company’s bond primary market, secondary market trade
- government and general obligation bond’s secondary market trade
- derivatives trade
Following types of trade conducted using auction method:
- Government and General obligation bond’s primary market trade
- Government ownership securities trade
- Trades executed by the order of law enforcement of authorized body
- Securities portfolio trade
Daily price change limit: securities’ price liquidation shall be fluctuated within 15% upper and lower sides on whole trading day.
Trade of securities can be made by MNT and foreign currency, except Government and General Obligation bonds. Trade unit by MNT must be measured by only whole- some MNT.
Securities clearing fees
In addition to brokerage fees, the following charges are payable from both selling and buying sides:
o 0.5% for MNT 100mln
o 0.4% for MNT100 mln to MNT 1 bln
o 0.3% for MNT 1 bln and above
Trading hours: Monday to Friday from 11:00 a.m. to 12:00 noon for both bonds and stocks.