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THE
Philippine Stock Exchange (PSE) will acquire a hi-tech,
early warning system to discourage and catch
unscrupulous people from penetrating the market with
their dastardly deeds, the exchange said in a statement
over the weekend.
This,
the exchange said, will further assure legitimate
investors of the stock market’s integrity.
Mr.
Francis Lim, PSE president and chief executive officer,
said the PSE’s latest anti-stock market fraud project,
called the Advanced Warning and Control System (AWACS),
includes software and hardware capable of detecting
suspicious stock market activities.
“This
is our signal for potential stock market wrongdoers to
stay away from our market and for legitimate investors
to entrust more of their funds with us,” Mr. Lim
declared.
Mr.
Lim said the PSE’s Board of Directors has approved the
AWACS project for immediate implementation within the
next few weeks.
“AWACS’ introduction will ratchet up to global standards
our capability to track insider traders and stock market
manipulators,” Mr. Lim said. “We adopted AWACS as part
of our overall program to enhance the level of
confidence of investors on us”
The
AWACS is a highly sophisticated monitoring package that
allows the Exchange to keep track of the securities
market and immediately detect unusual trading
activities.
Developed by a Singaporean firm, AWACS has the ability
to analyze trading patterns of the shares of listed
companies, as well as the trading behavior of the
trading participants and their clients.
One
of AWACS’ salient features is a market replay, which PSE
can use to review securities trading like one views and
controls video shots. The replay allows the PSE to
revisit “tick by tick” any day’s trade activity, freeze
any moment in time, forward or reverse data streams or
even enable and disable specific transaction
streams.
“The
system has astounding features to capture unusual stock
market activity, which can be used to flush out
suspected market wrongdoers,” Mr. Lim noted.
AWACS
can also detect and deter circular trading, or a
fraudulent scheme wherein a group of trading
participants collude to rig up or artificially induce an
increase in the price of certain stocks.
“With
all these and other functions of AWACS, the PSE can
actually identify possible insider trading and market
manipulation activities in a timely manner, thereby
significantly increasing investor protection and ensure
market efficiency,” Mr. Lim explained.
Warning signals or alerts are the core of AWACS. Alerts
can be configured to trigger in real-time (during
trading time) or offline (when the market is
closed).
AWACS
is equipped with powerful graphics that enhance
transparency and visibility of details.
With
AWACS’ impending launching, Mr. Lim reminded the public
to do their part in protecting their investments by
learning as much as possible about stock market
operations.
He
encouraged the public to join seminars about the stock
market being offered by the Securities and Exchange
Commission, the PSE and some local brokers.
“It
is not only a question of investing in the stock market
but more importantly, our people should do it properly.
A practical way of learning is to participate in
investor education activities available in the market,”
he pointed out.
Investors should rely on listed company fundamentals,
instead of relying excessively on market rumors and
speculations, to guide their investment decisions,” Mr.
Lim pointed out. “Speculative plays are meant for savvy
investors who are more than willing to take on very high
risks in exchange for a specified return,” Mr. Lim
added.
“Certain stocks are meant for specific types of
investors. The more the public understands what type of
investments suits their specific needs, the more these
investments can work to their advantage,” the PSE
president and CEO concluded. |
