For the next year, the Prague Stock Exchange has prepared several changes to the rules of its unregulated PX Start market. From the beginning of 2019, secondary trading (trading in previously subscribed issues) will take place monthly, specifically in the second week, with the exception of May, when trading is scheduled on the fourth Wednesday.
A total of three START Days, i.e. the days for IPOs, will be held in 2019: on 21 May, 8 October, and 10 December.
On the basis of the response after the first successful IPOs and consultations with Exchange members and advisors of issuers, the minimum investment will also be reduced to CZK 100,000 from 2019. This change will benefit small issuers in particular, heading to the PX Start market to raise tens of millions of crowns. The minimum investment is fully under the control of the issuer and its advisor. “On the basis of the experience from the first IPOs, which were fairly small in volume, and the response of our members’ clients, we decided to allow the issuers to reduce the minimum investment to CZK 100,000 per investor. Investments in small issues will thus be open to a much wider range of investors than hasn´t been the case so far,” says Petr Koblic, the CEO of Prague Stock Exchange.
The first investment and pension fund management company has decided to enter the PX Start market. Conseq Investment Management, the largest Czech independent investment manager, intends to include small and medium-sized enterprises from the PX Start market in its fund portfolios.
“We very much appreciate the activity of the PSE and we are pleased that it came up with the PX Start market. Profit in the Czech crown is what matters to our clients. They know the local environment well and want to invest in it. However, the investment portfolio should mirror the structure of the Czech economy, and small and medium-sized companies make up a substantial part of it. That is why we have decided to add to our equity portfolios companies that are traded on the PX Start market,” says Lukáš Vácha, a member of the Board of Directors of Conseq Investment Management.
Conseq intends to gradually allocate 5% of its exposure to what are called New Europe shares to securities traded on the PX Start market. Specifically, it means appx. CZK 200 to 300 million from two of its own funds. The first fund is Conseq Invest Akcie Nové Evropy, which focuses primarily on Central European markets and administers assets worth roughly CZK 3.3 billion. The second fund is the Conseq globální akciový účastnický fond, with approximately CZK 1.2 billion in assets, offered for supplementary pension savings.
“To us, investment in the PX Start market means a wider spectrum to choose from for our funds, as well as support for the Czech capital market. We believe that the PX Start market will take off, and we see it as an investment in the future,” says Jan Vedral, the Chairperson of the Board of Directors of Conseq Investment Management.
“I have always believed that issues from the SME segment will become an interesting alternative for the portfolios of regulated funds. I am pleasantly surprised that the first investor from this category is entering the market now and will be active in our PX Start market,” adds Petr Koblic.