Before you take the plunge into stock trading and investing, make sure you understand what stocks are and how the Philippine stock market operates.
Unlike other investments that are relatively safe, stock trading is generally risky and loss of money is a possibility. So if you want an easy-to-understand primer on stock trading, head over to PinoyMoneyTalk’s Guide on Stock Trading and Investing.
If you don’t have much time to read, here’s a brief overview of everything you need to know about trading stocks in the Philippine Stock Exchange (PSE).
What are stocks?
Shares of stocks represent ownership in a company. As a stockholder, you are a part-owner of a company.
As part-owner, you get certain rights, including the right to vote and the right to receive dividends when distributed by the company.
How do I make money in stocks?
As a stock investor, you can make money through one or all of these ways:
1. Capital appreciation – the change in price from the time you bought the stock to the time you will sell it. Of course, you only make money when you sell the stock at a price higher than the price you bought it.
2. Dividends – this is your share in the earnings of the company which may be distributed to shareholders in the form of cash or stock dividends; and
3. Stock Rights – the right given to you as a shareholder to buy additional shares of the company at a lower price compared to the market price.
What’s the minimum amount needed to invest in stocks?
Every stock trading transaction is governed by the Board Lot. This means the minimum amount of money needed to start trading stocks will actually depend on the stock you wish to buy and its price.
The PSE Board Lot shows the minimum number of shares that you can buy or sell at any time. The cost of the minimum amount of shares you’ll buy represent your minimum investment in stocks. However, in order to trade using a broker, some brokers require a certain deposit amount before you can open an account with them.
Check out sample computations of how much money you need to begin trading stocks in our article How to Use the PSE Board Lot Table.
New PSE Trading Hours in 2021
Because of the COVID-19 pandemic, stock trading in the PSE was shortened from 9:30 AM to 1:00 PM. This means total trading hours in the Philippine Stock Exchange are just 3 and 1/2 hours in a day.
This new rule was implemented from March 16, 2020 onwards, after the country was placed in quarantine status because of COVID-19.
Before COVID-19, from 2012 until before the pandemic lockdowns, stock trading was open from 9:00 AM until 3:30 PM.
In 2021, the PSE trading hours are as follows.
|PSE Trading Hours during COVID||PSE Activity|
|9:30 AM||Market Open|
|9:31 AM - 12:44 PM||Continuous Trading|
|12:50 PM||Run-off / Trading-at-Last|
|1:00 PM||Market Close|
9:00 AM – Pre-Open
Stock trading orders can already be entered but no matching of trades will occur yet.
9:30 AM – Market Open
Start of order matching and stock trading.
12:45 PM – Pre-close
Stock closing prices are set and posted orders cannot anymore be cancelled or modified.
12:50 PM – Run-off / Trading-at-last
Remaining orders are matched at a fixed price determined during the Market Pre-Close.
1:00 PM – Market Close
Market is closed with no order posting and matching occurring, but some brokers may accept after-hour orders to be processed the next day.
PSE Trading Hours before COVID Pandemic
The new trading hours are definitely much shorter than the entire stock trading duration that was implemented from 2012 until the COVID-19 pandemic.
From January 2, 2012 until March 13, 2020 before the COVID-19 lockdowns, the PSE trading hours were as follows.
|PSE Trading Hours before COVID||PSE Activity|
|9:00 - 9:29 AM||Pre-Open|
|9:30 AM||Market Open|
|9:31 AM - 11:59 AM||Continuous Trading|
|12:00 NN - 1:29 PM||Market Recess|
|1:31 PM - 3:16 PM||Continuous Trading|
|3:17 PM - 3:19 PM||Pre-Close|
|3:20 PM - 3:29 PM||Run-off / Trading-at-Last|
|3:30 PM - 8:59 AM The Next Day||Market Close|
- 9:00 a.m. to 9:29 a.m. — Pre-Open
- 9:30 a.m. — Market Open
- 9:31 a.m. to 11:59 a.m. — Continuous Trading (Regular stock trading hours; orders are continuously accepted, processed, and matched by the PSE)
- 12:00 noon to 1:29 p.m. — Market Recess (Market is closed for 1 and 1/2 hours, with no ordering and matching allowed)
- 1:30 p.m. — Trading Resumption (Trading in the stock market resumes in the afternoon)
- 1:31 p.m. to 3:16 p.m. — Continuous Trading (Regular stock trading hours; orders are continuously accepted, processed, and matched by the PSE)
- 3:17 p.m. to 3:19 p.m. — Pre-Close
- 3:20 p.m. to 3:29 p.m. — Run-off / Trading-at-last
- 3:30 p.m. to 8:59 a.m. the next day — Market Close
Previous PSE trading hours
Prior to 2012, the Philippine Stock Exchange had a trial run from October to December 2011 of its extended trading hours from 9:30 a.m. until 1 p.m.
Stock trading in the PSE before 2012 were for a mere 2 and 1/2 hours, from 9:30 a.m. until 12:10 p.m.
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