NEPSE to implement new method for determining final trading price
KATHMANDU: The Nepal Stock Exchange (NEPSE) is set to introduce a new method for determining the final trading price of stocks, effective from Thursday, March 20, 2025. This change was announced through a notice issued by NEPSE.
According to the new rule, the final trading price of shares each day will be based on the weighted average price of transactions occurring during the last 15 minutes of trading, from 2:45 PM to 3:00 PM. If no transactions take place in this final 15-minute window, the last traded price prior to that period will be considered the final price.
Reason for the Change
Previously, a company’s last traded price of the day was established as its final price. However, NEPSE noted that in some cases, prices were artificially inflated or deflated in the closing moments of trading. The introduction of the weighted average price aims to curb such manipulations and ensure a more stable and transparent closing price.
Based on International Practices
NEPSE stated that this change follows a study of international stock market practices. The 15-minute weighted average method was deemed suitable for Nepal’s market, prompting its implementation. NEPSE’s automated system will calculate the average of the transactions in this 15-minute period to determine the final price.
First-Time Use for Closing Price
While NEPSE has been using a system to determine opening prices based on supply and demand averages, this is the first time such a mechanism will be applied to closing prices.
Impact on the Market
This change is expected to bring greater transparency and stability to the stock market. NEPSE believes it will effectively prevent last-minute price manipulations. Investors trading in the market may now need to adjust their strategies in line with this new rule.
The move is seen as an effort to align Nepal’s stock market with international standards and boost investor confidence. The impact of this rule, effective from Thursday, on market behavior remains to be seen.
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