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Does IDSS still attractive to trader when it keep getting suspended?
As we all know, IDSS (Intra-day-short-selling) is only valid for a day. Trader only can short and cover short on the same day. Such restriction limit trader profit opportunity. To make things worse, we have seen the system kept getting suspended. Latest example is PWROOT. Shares open gap down and within 11 minutes IDSS got suspended. then pwroot share price rebounded back sharply. Does this rebound due to shorties gave up the short trade? Feeling puzzled, with this kind of intervention.
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Be the first to like this. Showing 5 of 5 comments
They were in a haste to reintroduce short selling the moment Najib allowed it. It was without proper study. The previous short selling during the 90s was way better than the current one.
2018-05-28 21:31
We do not know who is Bursa trying to protect. Or is some GLCs being stuck inside like EPF Tabung Haji LTAT etc..?
2018-05-28 21:33
Why IDSS suspension valid for Poweroot only? Should apply to all counters if Bursa is fair.
2018-05-29 03:46
Change govn to PH no meaning if Bursa still rule by same people. People vote for PH bec not satisfied with Bursa not the govn only.
2018-05-29 03:47
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Flintstones
This intervention is stupid. IDSS is a flawed system because most of the counters listed in Bursa are highly illiquid. These days, a poor quarterly result is a guaranteed > 10% drop at the open because there are no buyers available.
The mind boggling thing about the whole picture is the harvard MBAs working at Bursa Malaysia decided to suspend IDSS when things get ugly. So what happened afterwards is panic short covering ensues. Why panic short covering? Because without liquidity, THERE WILL BE NO BUYERS BUYING AT A LOWER PRICE AND HENCE THE SHARE PRICE WILL NOT GO DOWN ANYMORE AND HENCE THE WHOLE SHORT TRADE HAS PEAKED.
I am running a trading strategy that involves monitoring IDSS suspension real time. Once Bursa issue a suspension, you buy the hell out of the stock because the shorts will panic buy at a higher price. This is one of the reason why Power Root is so volatile today and ended up at a high despite posing a loss quarter.
2018-05-28 21:15