Only five months ago, many investors in Nepal’s stock market were demanding a special “last 15 minutes weighted average” rule. Now, the same people are calling for it to be scrapped.
How it started
In March, NEPSE introduced the rule after pressure from certain investor groups. The idea was simple: for the last 15 minutes of trading, prices would be averaged before settlement. Supporters believed this would stop sudden price manipulation at the end of the day.
Why opinions changed
Since its introduction, the market has been on a downward trend, falling from the 3,000 mark. Many now argue that the rule is making the decline worse. Even those who once pushed for it say it has backfired. Some admit they wanted the rule applied only to a handful of companies known for suspicious trading—not the whole market.
Regret and finger pointing
Leaders from major investor associations say the rule was brought in without enough technical tools or proper discussion with the wider investor community. They claim it was rushed, influenced by a few loud voices, and has become a burden.
Critics also point out that Nepal’s regulators often introduce new rules under pressure, without studying their long-term impact. Similar flip-flops have happened before, such as when investors demanded Friday trading, only to later push for its cancellation once the market turned negative.
What happens next
NEPSE’s CEO, who took office after the rule was already in place, says the system has no technical errors. He has offered to review the rule in a live demonstration with stakeholders. Investors, meanwhile, are preparing to approach the Securities Board again to demand changes.
However, removing the rule will take time. The Securities Board needs a formal meeting to amend the trading regulations, and it currently lacks a full board to make that decision. Until then, the last 15 minutes rule stays in place—despite growing opposition.
