Islamabad: The Securities and Exchange Commission of Pakistan (SECP) has proposed a comprehensive regulatory framework to regulate algorithmic trading in Pakistan. The move aims to improve the transparency and efficiency of the stock market through modern technology.
According to the SECP, algorithmic trading is a process in which computer programs automatically make trading decisions, which promotes fast and efficient transactions in the market. However, such trading also involves technical risks and uncertainties, which require regulatory oversight.
The proposed framework includes rules and regulations, registration, supervision, and market surveillance mechanisms for algorithmic trading. The SECP says these measures will protect the interests of investors and bring Pakistan’s financial markets in line with global standards.
Experts say the framework will bring Pakistan’s financial market in line with modern requirements and will help increase investment opportunities.
The Pakistan Stock Exchange (PSX) and other financial institutions have also welcomed the proposal and assured their support for its implementation.
It now remains to be seen when and how the government will finalize and implement this regulatory framework so that algorithmic trading can flourish in Pakistan’s financial market.