In light of the suspension of MBKE's MIP (monthly investment plan), one major downside I experienced with the MIP was the issuance of odd lots. Why does the SGX Odd Lot market even exist? What is the purpose of the Singapore Odd Lot market? - Seedly
 

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Asked by Kelly Wong

Asked on 30 May 2019

In light of the suspension of MBKE's MIP (monthly investment plan), one major downside I experienced with the MIP was the issuance of odd lots. Why does the SGX Odd Lot market even exist? What is the purpose of the Singapore Odd Lot market?

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Gabriel Tham
Gabriel Tham, Kenichi Tag Team Member at Tag Team
Level 9. God of Wisdom
Answered on 30 May 2019

Some companies allow shareholders to opt for scrip dividends. This results in odd lots. So there needs to be a market for these people to sell their odd lots, even though its not worth the fees.

There are also rights issues, placements, preferrential offerings, which may result in odd lots. Though they tend to give preference to allow shareholders to round out their holdings but still there is a chance of odd lots.

There are also share splits, consolidations which can result in wierd number of shares.

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