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Article 58-3
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The competitive auction for trading orders shall be divided into call auction and continuous trading. The first matching in the current session shall be done by call auction, and subsequent matching shall be done by continuous trading until a period of time before market closing, during which all the trading quotes shall be accumulated and matched by call auction.
Trade prices of call auction shall be determined based on the following principles:
- Satisfying the maximum trade volume such that buy orders with prices higher than the determined price and sell orders with prices lower than the determined price shall be all satisfied.
- Where there are buy and sell orders with prices equal to the determined price, at least one side shall be all satisfied.
- Where two or more prices conform to the principles set forth in the preceding two subparagraphs, the price closest to the most recent traded price in the current session shall be used. If there is not yet any traded price in the current session, the price closest to the auction reference price at market opening of the current session.
Trade prices of continuous trading shall be determined by each buy order or sell order that is entered based on the following principles:
- When the price of a buy order entered is higher than or equal to the minimum price of a sell order previously entered, orders shall be satisfied from the lowest to the highest price of sell order, in that order, until orders are all satisfied or until the price of the buy order currently entered is lower than the price of the unsatisfied sell order.
- When the price of a sell order entered is lower than or equal to the maximum price of a buy order previously entered, orders shall be satisfied from the highest to the lowest price of buy order, in that order, until orders are all satisfied or until the price of the sell order currently entered is higher than the price of the unsatisfied buy order.
The aforesaid auction reference price at market opening of the current trading session shall be determined by the following principles:
- Use the closing price for the preceding day.
- Where there is no closing price for the preceding day, the auction reference price shall be determined by the following principles:
- If, on the preceding day, the highest buy order price at the close of market was higher than the auction reference price at the opening of market, use the highest buy order price.
- If, on the preceding day, the lowest sell order price at the close of market was lower than the auction reference price at the opening of market, use the lowest sell order price.
- When neither of the above circumstances applies, use the auction reference price at the opening of market of the preceding business day.
- In the case of an initial listing, price adjustment due to ex-rights or ex-dividend trading, or resumption of suspended trading, use the price arrived at by processing, pursuant to Article 62 herein, the reference price as set in accordance with Article 59, 59-1, 67, 67-1, or 67-2, or other rules.
The opening price of a security is the price of the first matched trade for the current session. Trading orders entered prior to market opening that are unexecuted shall continue to be matched in the order as originally randomly assigned by the computer. The closing price shall be the price of trades matched upon accumulation of all trading orders over a period of time prior to market closing. Where unexecuted, the closing price shall be the last traded price during the current session.
Except securities that are newly listed common stocks during the period when no price fluctuation limit is imposed, and securities for which the opening auction reference price is lower than NT$1, during the period from the first matched trade of a security during the current session until the period of time prior to market closing, if any execution price as test-calculated prior to each matching fluctuates beyond 3.5% of the reference price:
- If a trading order entered is a limit order and is valid for the current day, except that an order whose execution price as test-calculated is within the price range and shall be satisfied immediately, the TWSE shall at the same time postpone the matching of the security for two minutes, and continue to accept entries, cancellations, and changes of trading orders for that security. Matching will then proceed by call auction at the conclusion of the postponement period.
- If a trading order entered is a limit order which will be canceled if not immediately satisfied in one trade, is a market order and is valid for the current day which will be canceled if not immediately satisfied in one trade, except that an order whose execution price as test-calculated is within the price range and shall be satisfied immediately, the remaining unsatisfied volume of the trading order entered is canceled.
- If a trading order entered is a limit order which will be canceled if not all order is immediately satisfied, or is a market order which will be canceled if not all order is immediately satisfied, the trading order entered is all canceled.
The reference price in the preceding subparagraph shall be determined by the following principles:
- Within five minutes after the first matching for the current session, the reference price is the price of the first matched trade. In the absence of a trade price in the first matching, the opening auction price shall be the reference price.
- After the first five minutes of the first matching for the current session, prior to each matching, a weighted average price is calculated based on the price and volume of all trades for the five-minute period immediately before the entry time of the order. In the absence of a trade price in the five minutes, the most recent trade price shall be used. In the absence of a most recent trade price, however, the opening auction price shall be the reference price.
- After the first matching for the current session, in the event of a postponement of matching of a security in the first subparagraph, within the five minutes after the conclusion of the postponement period, the trade price of the call auction during the session is the reference price. In the absence of a trade price during the session, however, the reference price shall be calculated in accordance with the preceding subparagraph.
If, during the 1 minute prior to market opening or market close for a security, any given computed execution price fluctuates beyond 3.5 percent from the previous computed execution price (if there is no previous computed execution price available 30 minutes before market opening, the fluctuation shall be based on the auction reference price at market opening; if there is no previous calculated execution price available a period of time before market closing, the fluctuation shall be based on the most recent trade price; if there is no most recent trade price available, the fluctuation shall be based on the auction reference price at market opening), the first matched trade for the current session, or the matching at market close, for that security is postponed. For a security for which the first matched trade for the current session is postponed, matching and execution for the security will proceed sequentially after 2 minutes of postponement. For a security for which the matching at market close is postponed, entries, cancellations, and changes of trading orders for that security will continue to be accepted from 1:31 p.m. to 1:33 p.m., and matching and execution will then proceed sequentially at 1:33 p.m. However, this restriction shall not apply to securities for which the opening auction reference price is lower than NT$1, call (put) warrants, or company warrants.
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Article 62
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The fluctuation unit (tick) of the prices of trading orders shall be determined as follows:
- Where the market price of a stock is less than 10 dollars per share, the tick shall be 1 cent, or 5 cents if the price is from 10 dollars to less than 50 dollars, or 10 cents if the price is from 50 dollars to less than 100 dollars, or 50 cents if the price is from 100 dollars to less than 500 dollars, or 1 dollar if the price is from 500 dollars to less than 100 dollars, or 5 dollars if the price is 1,000 dollars or more.
- The tick for government bonds and corporate bonds shall be five cents. The tick for convertible bonds shall be 5 cents if the price is less than 150 dollars, or 1 dollar if the price is from 150 dollars to less than 1,000 dollars, or 5 dollars if the price is 1,000 dollars or more.
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Article 67-1
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Where a listed company carries out procedures for capital reduction and issuance of new replacement shares, the daily price limits on its stock for the date on which the stock begins to list after the capital reduction shall be calculated based on the following methods according to the circumstances of the capital reduction:
- For a capital reduction for purposes of making up losses, the price limits shall be calculated on the basis of the closing price on the last trading day before the issuance of the new replacement shares divided by the ratio of the post-reduction number of issued shares to the original number of issued shares.
- For a capital reduction by cash refund of capital stock, the price limits shall be calculated on the basis of the closing price on the last trading day before the issuance of the new replacement shares minus the cash amount refunded per share, and then divided by the ratio of the post-reduction number of issued shares to the original number of issued shares.
- For a demerger accompanied by capital reduction:
- If the stock of the transferee company of the demerger, on the date that its listed trading begins after the capital reduction, is stock of a TWSE listed or Taipei Exchange listed company, the price limits shall be calculated on the basis of the closing price on the last trading day before the issuance of the new replacement shares minus the value calculated by the auction reference price at market opening on the date of commencement of listed trading of the TWSE listed shares of the transferee company of the demerger obtained per share after the capital reduction, or the value calculated by the basis price for the opening of trading of the Taipei Exchange listed shares, and then divided by the ratio of the post-reduction number of issued shares to the original number of issued shares.
- If the stock of the transferee company of the demerger is stock of a company that is neither TWSE listed nor Taipei Exchange listed, the calculation shall be done by the method below, and the higher figure shall be the basis for calculation of the upper price limit and the lower figure shall be the basis for calculation of the lower price limit, and the price arrived at by processing, pursuant to Article 62 herein, the average of the two figures shall be taken as the auction reference price at market opening:
- The reference price calculated by first calculating the market capitalization by multiplying the closing price of the last trading day prior to the issuance of the new replacement shares by the original number of issued shares, then calculating the market capitalization after the capital reduction by the ratio of the company's net worth after the capital reduction to the company's original net worth, and then further dividing it by the number of issued shares after the capital reduction.
- The reference price calculated by the closing price of the last trading day prior to the issuance of the new replacement shares minus the net worth of the shares of the transferee company of the demerger obtained in replacement per share, and then divided by the ratio of the post-reduction capital amount to the original capital amount.
Where there is no closing price for the last trading day prior to the issuance of new replacement shares referred to in the preceding paragraph, it shall be replaced by the price determined by the principles set out in Article 58-3, paragraph 4, subparagraph 2 herein.
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