market architecture of selected stock exchanges in ... - Gilles Daniel

76limits downwards with the appropriate price tick.Trading HaltsThe ISE imposes a trading halt mainly due to disclosure of information andannouncements made by listed companies (see the trading halt statistics in Table 41).There is no regular halt mechanism based on order imbalances and volatility (Bildik2001).Based on the disclosure regulations, companies listed on the ISE must disclose thematerial information to the ISE before it has been made publicly available by theexchange. Trading halts initiated due to information disclosure usually last shortperiods of time (15-30 minutes on average) depending on the importance of the news(Bildik 2001).During a trading halt, investors or brokers may cancel or change their outstandingorders, which is not allowed during trading hours. Thus, a trading halt is veryimportant for investors at the ISE and almost the sole opportunity to modify theirorders after the new information comes to the market since there are no balancingperiods or auctions during continuous trading (Bildik 2001).The decision whether a trading halt has to be imposed is at the discretion of the ISEmarket regulators, which is the exchange or the Capital Market Board of Turkey.Trading halts initiated by the SEC usually last longer (up to several days) dependingon the reasons for the halt (Bildik 2001).Table 41: Discretionary Trading Halt Statistics Reported by the ISEPeriod January 2000/ October 2001Number of halts 209News Pending 34%Capital Increase & Dividend/Rights Announcement 22%CausesRegulator 20%Fin Statements 13%M&A 11%Mean3.1 daysDurationMedian0.3 dayMode1 daySource: IOSCO (2002)