PSE set to introduce 'over the counter' market trading product

The Philippine Stock Exchange is planning to offer a new product that will facilitate over the counter market trading, which it said would specifically benefit overseas Filipino workers wanting to invest in the local bourse. The PSE said it will be developing the product together with MF Global Singapore PTE Ltd., a broker of exchange-listed futures and options in the world. The product, called a contract for difference, allows buyers to enjoy the economic benefits of the investments minus voting rights afforded to regular shares. Peter Oxlade, senior vice president for securities of MF Global said the CFD would be marketed to overseas Filipinos who would want get a piece of action in the PSE. “A CFD is an equity derivative that allows investors to gain exposure to share price movements, without the need for direct ownership of the underlying shares. It also efficiently allows investors to take long or short positions, where the investor provides a cash deposit or a margin as collateral rather than the payment of the full value of the underlying position," Oxlade said. The derivative will initially be offered outside the Philippines. However, no specific timing has been set for the launching of the product. PSE and MF Global are set to do a roadshow in other countries to introduce the Philippine bourse to OFWs and even to sophisticated investors. MF Global is estimating that with the launch of CFD, which is likened to a relative abroad buying a product here in the Philippines through online transaction, the PSE could expect as much as 30-percent boost in its liquidity. MF Global, which is listed in New York, has some 1.5 million clients all over the world. - Cheryl Arcibal, GMANews.TV