Tweaks planned to 'Risk Alert Board'

The Shanghai Stock Exchange plans to alter and improve its "Risk Alert Board" program, and intends to formally implement it in 2013, the SSE said on its website on Tuesday.

Industry insiders and investors already have expressed their opinions on this plan. Some think it too strict, and have submitted suggestions on improving it. The SSE will alter the plan accordingly, the authority said on its website.

The SSE announced in late July that it would set up a "Risk Alert Board", specifically for the trading of shares in the companies with a delisting risk alert and other ones with major risks. The idea was preventing the risks of trading shares in SSE-listed companies, avoiding speculation on junk shares, and encouraging delisting of such shares.

Stocks on this board will have a daily price increase capped at 1 percent, down from the current 5 percent, while maintaining the maximum limit of the daily decline at 5 percent.

Analysts said that under the new rules, making money from junk stocks will be difficult, and the odds of incurring losses will increase. Thus some are calling on maintaining the current limitation on rises and declines.

Special-treatment shares, or "junk shares," which will be included in the Risk Alert Board under the current plan, collapsed last week after the SSE declared this plan.