Investment under CFS stands capped

Total investment under the Continuous Funding System (CFS) on the Karachi Stock Exchange throughout the previous week stood unchanged at the cap level of Rs25 billion, demonstrating that the financing limit of Rs25 billion is small keeping in view the increasing demand.

Analysts said that an idea of more funding may well be had from the fact that the CFS worth about Rs2 billion was billed as outstanding bids.

However, CFS rates at the KSE showed a modest rise at 16.5 per cent from the previous 16.2 per cent a week earlier. They touched the week’s highest at 16.8 per cent briefly.

UAMC renamed as UBL Fund Managers Limited

The United Asset Management Company Limited (UAMC) has been renamed as UBL Fund Managers Limited (UBLFM). The UBLFM is a wholly-owned subsidiary of the United Bank Limited (UBL), which is Pakistan’s second largest private commercial bank.

The UBL was the pioneer in initiating asset management services in the banking sector with the launch of UAMC in 2002 and has thus become a trend-setter.

The UBL Fund Managers Limited has been successfully managing United Money Market Fund (UMF), which is one of the largest open-end money market funds in Pakistan with a size of Rs 3.75 billion.

Investment under CFS stands capped

Total investment under the Continuous Funding System (CFS) on the Karachi Stock Exchange throughout the previous week stood unchanged at the cap level of Rs25 billion, demonstrating that the financing limit of Rs25 billion is small keeping in view the increasing demand.

Analysts said that an idea of more funding may well be had from the fact that the CFS worth about Rs2 billion was billed as outstanding bids.

However, CFS rates at the KSE showed a modest rise at 16.5 per cent from the previous 16.2 per cent a week earlier. They touched the week’s highest at 16.8 per cent briefly.

More financing modes available at bourses

Investors at capital market after reaching the limit under Continuous Funding System (CFS) have more avenues to finance shares to purchase, like in-house badla, futures options and other derivatives, soon to be formulated.

After being effective from August 22, 2005, the CFS in 14 scrips has reached its upper limit of Rs 25 billion.

The response of the market to the announcements made after the meeting of brokers, SECP and Prime Minister, which included launching of CFS, launching of Pre-Trade Verification System and increased tenors for future contracts, was very positive and the KSE-100 index gained 278 points, with trading volumes increasing by 69 percent on day-to-day basis from less than 200 million to over 300 million shares.

More financing modes available at bourses

Investors at capital market after reaching the limit under Continuous Funding System (CFS) have more avenues to finance shares to purchase, like in-house badla, futures options and other derivatives, soon to be formulated.

After being effective from August 22, 2005, the CFS in 14 scrips has reached its upper limit of Rs 25 billion.

The response of the market to the announcements made after the meeting of brokers, SECP and Prime Minister, which included launching of CFS, launching of Pre-Trade Verification System and increased tenors for future contracts, was very positive and the KSE-100 index gained 278 points, with trading volumes increasing by 69 percent on day-to-day basis from less than 200 million to over 300 million shares.

Pre-Trade Verification System at the Stock Exchanges

The pre-trade verification system would be put into place from Monday (Sept 12) at the stock exchanges. That was one of the nine points on which market players and the corporate regulator had inked an agreement in the presence of Prime Minister Shaukat Aziz on August 19.

The system is universally believed to be a step that would strengthen risk management measures, which would eventually contribute to improving the health of the bourses. But the question that boggles many minds is whether the stock exchange has developed or acquired the required technology and software to introduce the system as early as on September 12 and whether all market players have adequate knowledge of how the system would function?