Dubai Financial Market announced on Monday its intention to apply the upgraded version of the "pre-closing session", as well as the introduction of "trading period according to the latest closing price", starting on Thursday, June 4, 2015.
A press statement which "Mubasher" received a copy of it pointed to that: "pre-closing session " will provide with its new form, a framework for regulating the various operations of input and cancel orders, and matching buy and sell orders, while "trading period according to the latest closing price" and its duration is of 5 minutes, allow for investors to put their orders in accordance with the closing price (the bid price calculated through the system).
The Dubai Financial Market has applied a "pre-closing session," initially in May last year.
The new arrangements comes as outcome of extensive discussions with dealers in the market, as part of the continuing efforts of the market for the development of its infrastructure in line with the best practices in this area.
Under that developed formula "session before the closure" will be from one o'clock and 45 minutes at noon to one o'clock and 55 minutes and 20 seconds. And "the session" includes on a timetable regulates the introduction of new commands and modify or cancel it, and includes three phases: commands input phase, ban cancel orders stage, and matching buy and sell orders phase.
As it is the case since the adoption of the market for pre-closing session, this session is a "commands accumulation period", allowing for brokers and investors to input deferred implementation orders until the completion of the matching process.
With regard to the "trading period according to the latest closing price" it would be between one o'clock and 55 minutes and 20 seconds till two o'clock and 20 seconds, allowing for brokers and investors to put enforceable orders, whether new orders, or pre-entered, according to the closing price only and reliance to be on the previous closing price in the absence of a new closing price during the same meeting.
"The main advantages of the trading period according to the latest closing price" is one of the many Dubai Financial Market initiatives; to keep up with the market upgrade by MSCI Foundation.
The trading period according to the latest closing price will contribute to reduce the likelihood of an imbalance in the Order Book if the margin was between the prices of supply and demand during the session before the closure was high.
The trading period according to the latest closing price also promotes the efforts of investment institutions to re-balance transactions, as well as deal flow of customers; regardless of session's data before closing that have a significant impact on the price matching process before closing.