Any non-listed securities can be traded in alternative trading board

Any equity, debt or collective investment scheme securities can be traded in the proposed alternative trading board (ATB) of the stock exchanges even if they are not listed there.

The Bangladesh Securities and Exchange Commission (BSEC) in its 709th meeting on Tuesday approved the final version of the Alternative Trading Board Rules 2019.

BSEC officials said the alternative trading board at both the stock exchanges in Dhaka and Chattogram will provide with a convenient platform to bring in interested buyers and sellers of non-listed securities.

The securities may include both common and preference shares of non-listed companies, non-listed bonds, debentures, Islamic debt securities sukuk, non-listed open-end mutual funds and units of various alternative investment funds.

The securities will not have to be listed with the stock exchanges but there will be some essential preconditions and due diligences to go through, said the BSEC.

And each of the securities must be dematerialised in form, which requires an electronic entry of the securities into the system of the Central Depository Bangladesh Ltd, according to a press release by the BSEC.

Shares delisted from the stock exchanges and over the counter market stocks too can be bought and sold in the alternative trading board.

There are many securities outside the stock exchanges and these also need to be transacted among investors. Investors buy and sell those in private arenas, which often lack a convenient price discovery mechanism and both buyers and sellers suffer for the lack of liquidity.

Liquidity is the convenience for the owners of any asset that they will find sufficient buyers if they plan to divest. The buyers too look for a competition among sellers to buy from.