Why are shares quoted to 3 decimal places?

I do understand that the ASX works up to three decimal points. What I would like to know is how one Australian dollar is divided by .nn For example: Shares in a company is shown as $3.600, $3.590, $3.580. Can you please explain? Dexter

Dear Dexter and readers,

Shares listed on the ASX are quoted up to 3 decimal points as there are stocks that are priced below 1c. The lowest priced security on the ASX is 0.1c or $0.001.

The price of these stocks move in 0.1c or $0.001 increments all the way up to 10c. Thereafter the price increments are in 0.5c movements up to $2.00.

All stocks priced at $2 and higher move in 1c increments.

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Therefore in the example that you gave, the stock can only move in 1c increments as it is priced above $2.00, but if you were looking at a stock that was worth 21c, it would be quoted as $0.210, but if it moved up to the next price increment it would be 21.5c which would be quoted as $0.215.

Sean Nofal, amscotOnline Manager, Amscot Discount Stockbroking

Important Information

The views expressed in this article are those of Sean Nofal, amscotOnline Manager. Amscot Discount Stockbroking is a division of State One Stockbroking Ltd, a participant of the ASX Group. ABN 95 092 989 083. AFSL 247100

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