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What Investors Really Need To Know About SGX’s Current Delay For The Start of Trading

For those of you wondering why the markets haven’t yet opened today despite 9am having passed, it’s because the Singapore Exchange Limited (SGX: S68) has decided to delay the opening to 12:30pm instead.

According to the company, the late start to trading had to be made “to enable member firms to complete client position reconciliations, and rectify any errors in the end-of-day processing for 1st December 2014.” Channel News Asia had reported on the issue and added that this is the “second major disruption [to the securities market] in the space of one month.”

The last glitch that happened to Singapore’s share market actually took place on 5 November 2014, when the Singapore Exchange had to halt trading in its securities and derivatives market for more than two hours due to power supply issues.

When that happened, I wrote about it and urged investors to not be bothered about the outage because the companies they’re invested in would likely not see their businesses be affected by it – unless the company’s Singapore Exchange, of course.

It’s the same with this current delay in the start of trading, especially when Singapore Exchange has reassured investors that “there is no impact to investors’ CDP holdings, or SGX trading, clearing and settlement capabilities.” The companies we own will still go about business as usual, making money, and trying their best to compound wealth for investors over the long-term (though some would inevitably fail).

So, what you really need to know about today’s delay in the start of trading is that there really is nothing much to it if you’re a long-term investor in businesses. In my article on the 5 November trading halt, I ended with the following statements and I think it’s apt to repeat them again:

“To be clear, I’m not saying that it’s okay for trading glitches to occur. To the contrary, I think smooth and orderly capital markets are very important. But, when markets have to be shut down due to glitches or technical faults, it’d be best to have the right perspective so that we can still make rational investing decisions.”

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore writer Chong Ser Jing doesn’t own shares in any companies mentioned.