SECC cuts transaction fees for derivative trades

A man drives past the offices of the Securities and Exchange Commission of Cambodia (SECC) in Phnom Penh in 2014.
A man drives past the offices of the Securities and Exchange Commission of Cambodia (SECC) in Phnom Penh in 2014. Hong Menea

The Securities and Exchange Commission of Cambodia (SECC) has decided to slash transaction fees on derivative trading, a move the SECC claims will help spur future trades.

According to the new prakas, signed on December 26 by Finance Minister and SECC President Aun Porn Moniroth, a lowered transaction fee for exchange derivatives of $1 per lot – or per every $1,000 traded – will come into effect beginning January 1. Currently, the SECC collects fees twice on every transaction, at the opening and closing of each account.

 

Vin Pheakdey, director of securities intermediaries supervision department at the SECC, said yesterday that the new decision would make the market more attractive for potential traders.

According to the SECC’s original transaction fees, he explained, a trader with an initial investment of $1,000 would have to pay total fees of $6 – $3 when opening a trading account and another $3 when closing the same account. In the new system, however, investors will pay just $1, being charged a one-time fee of just 0.1 percent of the initial investment.

 

“If we charge higher fees we can collect higher revenues, but our market becomes less attractive to traders as a result,” he said. “We expect that this lowering of our transaction fees will help attract more traders, which will eventually lead to the expansion of trading activities and competition in our market.”

He added that derivative trading had been gradually becoming more popular, but declined to disclose the number of currently registered derivative trading accounts.