I have a question regarding the after market settlement period. I see the match price fluctuating up and down on my screen during this period, ending up with a final settlement price. My question is: on a End Of Day trade, do I end up with the final settlement price, or could it be traded at a different price during this settlement process? Robert
If your order is executed in the Closing Single Price Auction (CSPA) or “match off” occurring at approximately 4.10pm each day, then yes you will end up with the final traded price of the day.
The market is open between 10am and 4pm Monday to Friday.
Between 4pm and 4.10pm the market enters a trading phase known as pre-CSPA. This is when you will see the match price fluctuate. During this time there is no trading, however investors can still place new orders or cancel and amend existing orders in the market.
What occurs next is what is referred to as the Closing Single Price Auction which is when ITS (the Integrated Trading System) will match off all orders and only overlapping buy and sell orders will be executed. This occurs for one minute sometime between 4.10pm and 4.12pm. These trades will be executed at the volume weighted average price, which is also the final traded price of the day. Stocks where the highest bid and lowest offer do not overlap, will not take part in the match-off.
All shares will of course now be worth the final settlement price. This could be more than you bought them for, or less, depending on the volumes exchanged during the Closing Single Price Auction.
The views expressed in this article are those of Matt Comyn, a representative of Commonwealth Securities Limited (CommSec) ABN 60 067 254 399 AFSL 238814. Commonwealth Securities Limited (CommSec) ABN 60 067 254 399 AFSL 238814 is a wholly owned but non-guaranteed subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 and a Participant of the ASX Group and the Sydney Futures Exchange. As this information has been prepared without considering your objectives, financial situation or needs, you should, before acting on this information, consider its appropriateness to your circumstances and if necessary, seek appropriate professional advice.