The Taiwan Monthly

Market & ETP Overview

Future work plans of the Taiwan Stock Exchange

Although the impacts of the pandemic has struck the world over the last two years, Taiwan’s economy has rallied to deliver a stunning performance, boosting last year’s growth to 6.1%. As we look to the future, with vaccination coverage gradually expanding, we expect that global economic activities will return to normal and supply chain issues will be alleviated. With high demand for 5G, automotive electronics, high performance computing, and other innovative applications, Taiwan’s semiconductor industry can leverage its leading manufacturing processes to expand their capabilities and foster the continued development of related industries. At present, most economic forecasting agencies predict that Taiwan’s economy will grow at over 4% for 2022, listed companies will continue to operate at optimal levels, and the domestic stock market will continue on its steady rise. However, international issues such as the pandemic, inflation, and rising interest rates still pose considerable unknown factors that require careful observation as the TWSE navigate the global landscape.

 

The TWSE has launched a number of new initiatives in recent years to strengthen market functions. Such measures include continuous trading, which has greatly enhanced trading efficiency and boosted transaction volume; fixed-term fixed-amount investment trading and intraday odd lot trading, allowing younger investors to more fully participate in the stock market, engage in long-term saving and investment, and thereby accumulate their wealth; and the market making mechanism, which enhances the trading volume of quality stocks with low liquidity, has succeeded by boosting the trading value by 40% compared to pre-implementation. Taiwan’s securities market is fully positioned with international practices. Although global competition is greater than ever, we are committed to moving forward, moving onward, and pushing market momentum to new heights.

To protect the interests of investors, the TWSE has long held that companies must reach a certain scale and profitability in order to raise funds on the capital market. These days, however, technology advances at such speeds that a company’s success is dependent on its ability to keep up and leap ahead in R&D. To meet the needs of long-term industry development, innovative startups of outstanding quality must be granted early access to the capital market and hone their operations and competitiveness through market forces. To this end, the TWSE has launched the Taiwan Innovation Board (“TIB”) in July 2021. Since its inception, the TWSE has held numerous hearings, visited over 60 startups, and secured eight companies that express their willingness to list on the TIB. It will take time to see the fruits of our labor, and the goal is that, with the continued efforts of intermediary agencies, the TIB will attract and accelerate the development of quality startups and boost the growth of domestic industries.

With electronic orders already accounting for 76% of all orders, the TWSE is committed to providing a convenient and secure trading environment for all investors. To this end, we have been working with securities and futures agencies to build up information resources, undertake digital transformation, improve overall information security for the securities market, and establish a risk management system. The Securities and Futures Computer Emergency Response Team (SF-CERT) was established to provide 24/7 assistance in case of abnormal events. In light of a recent spike in investment scams, the TWSE has strengthened its messaging through multiple channels to educate investors on risk awareness and taking precautions against fraud.

 

For further information, please contact Mr. Kao at 1219@twse.com.tw.