Stock Exchange of Thailand

The Stock Exchange of Thailand (Thai: ตลาดหลักทรัพย์แห่งประเทศไทย; abbr. SET) is the only stock exchange in Thailand. Founded on 30 April 1975, it is ASEAN's 2nd largest after Singapore and the world's 25th by market capitalization at US$513 billion (both SET and mai) as of 22 October 2022.[1] From 2015 to June 2020, it was the biggest IPO market in Southeast Asia in terms of accumulated raised fund at USD 17.8 billion (THB 598.0147 billion). It is also the region's most active bourse for 10 consecutive years with daily trading turnover normally exceeding USD 2 billion.

The Stock Exchange of Thailand
SET
ตลาดหลักทรัพย์แห่งประเทศไทย
TypeStock exchange
LocationBangkok, Thailand
Coordinates13.763738°N 100.56737°E / 13.763738; 100.56737
Founded30 April 1975 (1975-04-30)
Key peoplePakorn Peetathawatchai
(president since 1 June 2018)
CurrencyThai baht
No. of listings834
Market cap17.212 trillion baht for SET and 422 billion for mai (26 October 2023)
IndicesSET Index
SET50 Index and SET100 Index
Websitewww.set.or.th

In recent years, the number of market participants has risen sharply:[2] trading accounts has increased almost 10 times from 2008 to 2022.[3]

SET index is the oldest and the most cited equity index in Thailand. It made intraday all-time high at 1852.51 on 27 February 2018, surpassing the previous high of 1789.16 on 5 January 1994.

SET has stricter price regulations than some other exchanges, normally disallowing stock prices to rise or drop more than 30% in a day.[4]

Overview

The exchange operates 2 markets for listed companies: SET and mai (Market for Alternative Investment) the latter of which is for small and medium enterprises.

There are 834 listed companies as of 26 October 2023: 623 companies on the main exchange and 211 on mai.[5]

Apart from common stocks, investors can trade other types of securities including warrant, derivative warrant (DW), depositary receipt (DR), exchange-traded fund (ETF), property fund (PF)/ real estate investment trust (REIT) and infrastructure fund. The exchange also runs a separate market for derivatives.

As of August 2021, the Thai bourse attracted investors from 124 countries, up from 116 the previous year. The top ten nationalities' holdings of Thai stocks amounted to US$147.5 billion (THB 4.77 trillion), accounting for 93.7 percent of all foreign stock ownership. The rank of the first seven nationalities remained unchanged from the previous year: the UK, Singapore, Hong Kong, Switzerland, the US, Japan and Mauritius.

There has been growing interest in overseas investment among domestic investors. The US, China (including Hong Kong) and Vietnam are among the most popular, followed by Europe and India. Currently, the exchange has no foreign listing but ones can invest overseas by buying DR (depository receipt) which has been launched since 2018 as well as ETF.

To attract foreign investors and encourage cross-investment within ASEAN, exchanges in the region co-operate to facilitate investing in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.[6] Other ASEAN countries namely Cambodia, Laos and Myanmar also have exchanges with the exception of Brunei.

History

The Stock Exchange of Thailand

A precursor Bangkok Stock Exchange was established in July 1962 as a private entity. It finally ceased operations in the early 1970s due to a lack of government support and limited interest and understanding of the equity market among populace.[7]

In 1972, the Thai government took a step in creating a capital market. The changes extended government control and regulation over the operations of finance and securities companies, which until then had operated fairly freely. Then in May 1974, long-awaited legislation for the incorporation of SET was enacted to provide securities trading in order to promote savings and mobilize domestic capital. This was followed by revisions to the Revenue Code at the end of the year, allowing the investment of savings in the capital market. By 1975, the basic legislative framework was in place and on 30 April 1975, the Securities Exchange of Thailand officially started trading. On 1 January 1991 the name was formally changed to the Stock Exchange of Thailand (SET).[8]

Thailand Futures Exchange (TFEX), a subsidiary of the Stock Exchange of Thailand (SET), was established on 17 May 2004 as a derivatives exchange. On 28 April 2006 SET50 Index Futures was launched as the first product. Single Stock Futures was first launched on 24 November 2008. Derivative warrant was launched on 9 July 2009.[9][10]

In 2008, the Securities and Exchange Commission, Thailand together with the central bank allowed domestic individual investors to invest abroad directly for the first time through a Thai brokerage. Previously, only institutions could invest overseas.[11]

Trading
See also: Block trade

SET began fully computerized trading in April 1991. The system allows brokers to advertise their buy or sell interests by announcing bid or offer prices. Members may then deal directly with each other, either on behalf of their clients or for themselves. Prices may be adjusted during the negotiation; hence, the effective executed price may not be the same as that advertised and may not follow the price spread rules. After concluding negotiations, dealers must send details of the results for recording purposes.[12]

Trading through mobile device began in 2010 with the launch of settrade streaming for iPhone according to SET's 2010 annual report (page 36).[10]

Indices and listed securities

Current EPS of the SET index is 83.46.[13]

There is no index which combines both SET and mai. Some original mai companies have been listed in SET.

In the first day of trading, there were 8 listed companies and 5 of them still remain: BBL, BJC, DUSIT, SCC, and TCAP.

There are 12 DR as of 15 March 2023: 1. E1VFVN3001 which tracks VN30 Index 2. BABA80 3. FUEVFVND01 4. TENCENT80 5. NDX100 which tracks Nasdaq-100 6. STAR5001 7. XIAOMI80 8. BYDCOM80 9. AAPL80X 10.TSLA80X 11.CNTECH01 12.PINGAN80

CHINA is an ETF which tracks CSI 300 Index. So far it is the only ETF which invests overseas.

low of SET Index
events intraday low or closing[14]
record low76.43March 17, 1976
1997 Asian financial crisis204.59September 4, 1998
subprime mortgage crisis387.43October 27, 2008

SET Index was at a peak of 924.70 in November 2007 before the subprime crisis.

Tick sizes
minimum price movements[15]
pricetick size
less than 20.01
2 up to less than 50.02
5 up to less than 100.05
10 up to less than 250.1
25 up to less than 1000.25
100 up to less than 2000.5
200 up to less than 4001.00
400 up2.00

Challenges

Since 2013, the Thai economy's slow growth due to factors such as an aging population and technological disruptions has adversely affected the benchmark SET index's performance. Although the number of listings has significantly increased, a large proportion of these have been from older companies or spin-offs of existing listed companies. The market has also seen several mergers and acquisitions. While new companies have been listed, they tend to be small and have little impact on the SET index.[16]

References
  1. "ตลาดหลักทรัพย์แห่งประเทศไทย – Market Overview".
  2. "ตลาดหลักทรัพย์แห่งประเทศไทย – สรุปสถิติสำคัญของตลาดหลักทรัพย์".
  3. "ตลาดหลักทรัพย์แห่งประเทศไทย – สรุปสถิติสำคัญของตลาดหลักทรัพย์".
  4. Eustance Huang (15 April 2020). "Thai stock exchange president: Volatility has 'reduced significantly'". Cnbc.com. Retrieved 12 April 2022.
  5. "ตลาดหลักทรัพย์แห่งประเทศไทย – สรุปจำนวนหลักทรัพย์และบริษัทจดทะเบียน".
  6. "ASEAN exchanges".
  7. "The Stock Exchange of Thailand – About SET – SET Overview". Set.or.th. Retrieved 12 April 2022.
  8. "History & Roles". Stock Exchange of Thailand (SET). Retrieved 24 July 2020.
  9. "Thailand Futures Exchange – About TFEX – At a Glance". TFEX. Retrieved 12 April 2022.
  10. "ตลาดหลักทรัพย์แห่งประเทศไทย – เกี่ยวกับตลาดหลักทรัพย์ฯ – รายงานประจำปี". Set.or.th. Retrieved 12 April 2022.
  11. "2008 annual report" (PDF). Sec.or.th. Retrieved 19 May 2022.
  12. "The Stock Exchange of Thailand – Supervision of Market – Trading system and procedure". The Stock Exchange of Thailand. Retrieved 1 July 2011.
  13. "SET Quote - Stock Exchange of Thailand SET Index". Bloomberg News.
  14. "กางสถิติ SET Index ใช้เวลานานเท่าไหร่กว่าจะฟื้นจากวิกฤต".
  15. "The Stock Exchange of Thailand – Products & Services – Trading Procedure – Equities Trading". Set.or.th. Retrieved 12 April 2022.
  16. "ความท้าทายของตลาดหุ้น จีน เกาหลีใต้ เวียดนาม และ ไทย". 21 April 2023.
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