After enjoying a brief hiatus over the festive season that was laden of copulas amounts of all manner of hedonistic treats, we clicked on the Lusaka Stock Exchange’s lead story of a trade suspension ergo “SUSPENSION OF TRADING IN LAFARGE, ISIN ZM0000000011”. Now before all the Christmas pudding you eat starts to dissolve quickly due to panic, we at TFHZPC felt it necessary to tell you the tale of information symmetry. You see, when the Security and Exchange Commission (SEC) suspends a trade, it’s not all doom and gloom. Their purpose is to ensure that stakeholders such as shareholders are kept informed of all that is happening with the company. According to regulations, all listed companies are expected to provide information regarding their activities (that annual report the folks at TFHZPC love to decode) and interim reports that show how the companies are performing. Hence why in verbatim LuSe stated “..inform the market and shareholders that in keeping with the functioning of fair and transparent and orderly securities trading environment in this stock, the LuSe has suspended with immediate effect trading in LAFARGE security… The suspension in this stock will be lifted after seven days” http://www.luse.co.zm/wp-content/uploads/2017/01/Suspension-of-Trading-in-LAFARGE.pdf Normally, such stoppages are usually as a result of lack of material information on the traded security therefore in order to maintain information symmetry, trade is suspended until such a time that all obligations are meet by the trading company. The amount of time for a typical suspension is often judged on a case by case basis. This guards against information asymmetry and ensures that traders of shares are able to make informed decision about whether to buy, hold or sell stock on LuSe. So before you consider dumping your stock, make an informed decision. This is why agencies such as the SEC exist: To serve and protect the interest of investors. As we prepare to review the 2016 annual performance of the premier companies on LuSE, we pledge to ensure that all information bring to you, as always, will be as numerically accurate, concise and astute. That’s our new year’s resolution. But you already knew we would keep the promise. Didn’t you? Happy new year!
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