Most people, at the least, have heard of the Pakistan Stock Exchange (PSX) and the KSE100 index. Some are even aware of the fact that there is an odd lot market and a futures market that works in parallel to the stock market itself (don’t worry if this has come as a news to you). However, even fewer people are aware of the existence of a Negotiated Deal Market (NDM) and how it works.
Negotiated Market
Let’s get some of the basics out of the way. A negotiated market is a secondary market set up by the exchange itself. The purpose of the market is to allow a buyer and seller to be able to negotiate the terms of the deal away from the market. They can carry out a trade based on the terms that are suitable to the both of them. Such a trade can be carried out between two brokers who are operating in the market or between two clients who can be facilitated through brokers as well.
On the face of it, such trades are seen to be time consuming, require additional effort and are not transparent in their nature. The prices set for these trades can vary from the prevalent market price. Trading is supposed to be simple, clear and fast but trades carried out in the NDM market feel like they are arduous and the price discovery lacks transparency. It is this lack of transparency which makes these trades intriguing and can even give an impression of being unfair or inequitable to the market. The content in this publication is expensive to produce. But unlike other journalistic outfits, business publications have to cover the very organizations that directly give them advertisements. Hence, this large source of revenue, which is the lifeblood of other media houses, is severely compromised on account of Profit’s no-compromise policy when it comes to our reporting. No wonder, Profit has lost multiple ad deals, worth tens of millions of rupees, due to stories that held big businesses to account. Hence, for our work to continue unfettered, it must be supported by discerning readers who know the value of quality business journalism, not just for the economy but for the society as a whole.To read the full article, subscribe and support independent business journalism in Pakistan
