New Rules for Shares Below One Taka Effective from 29 October

The Dhaka Stock Exchange (DSE) has introduced new rules for trading shares priced below one taka. Under the new regulations, the minimum price increment—or tick size—for shares under one taka will be set at one poisha. This rule will come into effect from 29 October, according to DSE.

Currently, the tick size for all types of equity securities is 10 poisha. Recently, shares of Peoples Leasing & Financial Services Limited (PLFSL) and Fareast Finance & Investment Limited fell to 90 poisha.

This created a problem: under DSE regulations, the tick size determines the minimum price movement. Since the tick size was 10 poisha, the share price could not move by less than 10 poisha at a time. Meanwhile, the daily price movement limit—or circuit breaker—is 10%. For a 90-poisha share, 10% equates to 9 poisha. But the 10-poisha tick size prevented a 9-poisha movement. Consequently, shares could only move to 1 taka or 80 poisha, violating circuit breaker limits if attempted otherwise. As a result, trading in these shares effectively “froze,” preventing normal price fluctuations.

To resolve this, DSE has revised the tick size for shares trading below one taka.

DSE officials explained that several small and medium-sized companies have shares hovering around one taka, and recently two companies’ shares fell below that level. The old 10-poisha tick size trapped these shares within the circuit breaker limits, preventing normal market movements.

Under the new system, investors can place orders at finer increments, such as 89, 88, 87, 86, or 85 poisha, allowing more granular price changes. This is expected to reduce bid-ask spreads, improve liquidity, and lower transaction costs.

DSE has informed that this adjustment will enable finer price movements, ensure more market-friendly pricing, and align the market structure with international standards. The regulator, Bangladesh Securities and Exchange Commission (BSEC), was officially notified of the change by DSE on Sunday, 26 October.