The Thailand Futures Exchange (TFEX) has decreased the minimum size required for certain block trade transactions.
From today, minimum volumes are cut from 100 contracts to 25 contracts for block trades of 10-baht gold futures, 50-baht gold futures, and 20 individual blue chip stock futures.
Block trading of silver, oil, and sector-specific futures will also be allowed, subject to a minimum volume per trade of 25 contracts.
The notional value of block trade transactions will now range between baht 5 million to baht 25 million, depending on the underlying instrument.
The new rules have been applied to contracts that have high notional values. The idea behind the change is to allow investors to manage portfolios with more precision. For example, a block trade of 25 contracts of 50-baht gold futures will cost approximately baht 25 million, instead of the current value of baht 100 million for 100 contracts.
TFEX is a subsidiary of The Stock Exchange of Thailand Group (SET). Block trading in TFEX is similar to big lot trading in SET. The current minimum volume and value of big lot trades in the SET is at least 1 million shares or 3 million baht.