June 18 (THEWILL) — The Nigerian Exchange (NGX) has introduced a new framework that will significantly change how share prices move on the local bourse, setting minimum trading volume thresholds that must be met before stock prices can record any movement.
Three independent stockbrokers and traders familiar with the development confirmed the new rules. However, the NGX has yet to make a formal public announcement detailing the framework or its implementation timeline.
Sources indicate that the effective date will be communicated by the exchange in due course.
Under the new structure, stocks trading at N1,000 and above will require a minimum volume of 10,000 shares to be traded before a price change can occur.
Equities priced between N500 and N999.99 will require at least 50,000 shares to trigger a movement in price, while stocks trading below N500 will need a minimum of 100,000 shares exchanged before the market price can adjust.
The policy represents a major shift in the exchange’s price discovery mechanism and is expected to alter trading dynamics across the market.
Historically, relatively small transactions have been sufficient to move the prices of some equities, particularly less liquid stocks.
Market participants say the new thresholds could improve price stability by limiting the influence of low-volume trades on stock valuations.
The move is also expected to strengthen market integrity and reduce the potential for price distortions driven by isolated transactions.
However, some traders have expressed concerns that the framework could reduce price responsiveness in less actively traded stocks, potentially making it more difficult for market prices to quickly reflect changing investor sentiment.
The development comes amid increased regulatory focus on market liquidity, transparency, and efficient price formation as Nigeria’s capital market continues to attract growing retail and institutional investor participation.
Ogochukwu Onwaeze is a writer specializing in business and economic journalism. At THEWILL News Media, she translates market trends, financial developments, and policy shifts into clear and engaging stories.
