Published On: Fri, Apr 8th, 2011

Asia Etrading 2011 Q1 Highlights

Asia Etrading 2011 Q1 HighlightsThe first quarter of 2011 in Asia’s electronic trading industry continued to see growth and development as the globalization of trading drives ahead.

Sadly, the highlight of the quarter was the earthquake and tsunami which forever changed the lives of so many people in Japan and around the world. As a consequence of the disaster, Japan’s exchanges were hit by panic selling which saw volumes triple and volatility skyrocket. Arrowhead and J-Gate, which is name the of OSE’s exchange upgrade this February 14, handled the volumes without a hitch. Some questioned and criticized whether or not the exchange should have remained open at all. (What do you think?) But despite the circumstances Japan’s exchanges delivered a resilient and stable platform as promised. The brokerage industry also benefited from the increased volume in both equity and derivatives trading. Like the “Flash Crash”, quants and hedge funds made a great deal of money trading volatility. Lastly, the PTS competition in Japan continues to heat up with Chi-X Japan now exceeding SBI Japannext just after 6 months of trading. PTS volume is around 2-3% now.

On the subject of alternatives in Asia, Liquidnet reported record trading in Asia and connected to the Indonesia exchange. The ASX-SGX merger proposal was before the Australian Foreign Investment Review Board (since rejected) and ASIC finally announced a timetable for market competition and Chi-X Australia’s arrival. NZX announced that AXE ECN would be wound up and Chi-East, the Singapore-based sell side aggregator, completed its roll out to three markets.

Speaking of Singapore, SGX was equally as busy. SEB and RBS became derivatives members. Tin, lead, steel and rubber contracts are being proposed, Corvil was chosen for latency management, continuous trading was announced and so was the “world’s fastest trading engine” due in August. Their cross town rival, SMX, was busy too. Ong First, Newedge and Morgan Stanley became members. Nextview will offer real time market data and ICICI cleared its first trade.

HKEx, TSE and OSE altered trading hours to allow investors to better react to local and macro news events. Research on the microstructure impact of these time changes was also published from Morgan Stanley and Instinet.

Deutsche Bank’s KOSPI Index trading violation saw the bank banned in Korea and brought surveillance improvements at the bourse. SEBI also introduced its own surveillance initiative in India.

Data centers were also in the news. Six Telkurs began operating out of Equinix in Singapore and KVH opened a second data center in Tokyo.

IPC had an exceptional quarter announcing connectivity to the Tokyo Financial Exchange, Chi-east, Bursa Malaysia and SGX as well as relaunching their Turret dubbed Unigy. Now they just need sales people to sell that bandwidth.

China’s CSRC ok’d both the Morgan Stanley and JP Morgan brokerage JV’s, introduced lead and coke futures, issued guidelines on QFIIs trading index futures and are accelerating OTC trading regulations.

Thailand changed trading hours too, began offering single stock futures and silver on the TFEX, two members began market making in gold and the SET announced an initiative to promote algorithm trading.

In Hong Kong, Martin Wheatley announced his departure from the HK SFC to join the UK FSA, the HKEx had its ground breaking ceremony for its new data center in Tsuen Kwan O and also announced synthetic futures trading in its stock options market.

ISVs where also active too. Among them Patsystems was selected by the Vietnam Commodity Exchange and Sankyo Securities, Orc now offers high speed trading from Asia to US via Newedge, Symphony Fintech receives approval from NSE for algo trading, RTS opens a Hong Kong office, IRESS launches a market data consolidation feed for Australia, CQG connects to OSE and TOCOM and adds HSBC to its list of customers. Fidessa signs up ICICI securities and Ping An and also connected to the OSE.

These are just some of the highlights of what happened in Asia’s electronic trading industry this past quarter. Visits AsiaEtrading.com to get all the news and subscribe to our free weekly newsletter so you won’t miss a thing. You can also download the AsiaEtrading iphone app as well and yes it’s free too.

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