Taiwan Stock Exchange and MIAX Options Exchange Sign MOU
The MIAX Options Exchange (MIAX) was approved by the U.S. Securities and Exchange Commission (SEC) on December 3, 2012, becoming the nation’s eleventh options exchange. The signing of the MOU will enable U.S. ETF issuers to launch options on MIAX which track ETFs linked to TWSE listed stocks. This could improve international links to the Taiwan capital market and encourage more investors to trade Taiwan securities.
By strengthening cooperation with foreign exchanges, TWSE expects to meet the diverse demands of foreign investors to enhance the international standard and competitiveness of the Taiwan capital market.
The TWSE-MIAX MOU also aims to promote international cooperation and the development of ETFs comprising of Taiwan securities. It will also help boost trading volumes and the liquidity of the Taiwan capital market. Over the past few years, Taiwan ETF volumes have grown steadily, reaching 142.81 billion (4.76 billion USD) in the first half of 2013, with average growth of 25% each year.
TWSE has previously signed MOUs with NYSE Euronext, NASDAQ-OMX Exchange, BATS Exchange and Hong Kong Stock Exchange to obtain information on securities issued overseas by TWSE listed companies, as well as overseas ETFs linked to TWSE securities.
In mid-August 2009, TWSE cooperated with Hong Kong Stock Exchange (HKEx) to introduce 3 dual-listed ETFs in Taiwan in the form of either Offshore ETFs and Feeder Fund ETFs. The signing of the MOU with HKEx established the information exchange necessary for the creation of cross-border ETFs by both parties.
Since its establishment, TWSE has proactively signed MOUs with overseas exchanges in order to facilitate international communication and collaboration. The agreements also established connections with other securities markets, allowing the exchange to follow the latest development trends in the international capital markets. As of March 2013, TWSE had concluded a total of 34 agreements with 27 exchanges. Of these exchanges, 8 are from Central America, 5 from Europe and Africa and 14 from Asia and Oceania.
TWSE has obtained the following substantive benefits by signing MOUs with foreign exchanges:
A. Facilitation of Product Development: Assisting the launch of TDRs, overseas ETF listings, securities issued overseas by TWSE listed companies and the development of ETFs linked to listed companies in Taiwan.
B. Expansion of International Cooperation and Promotion of the Taiwan Capital Market: Launching initiatives to lay the foundation for further cooperation initiatives, such as sending staff for training to establish sound capital markets in emerging markets.
C. Staff Visits and Exchanges to Strengthen Business Collaboration: Fostering information exchange in areas such as warrants market promotion, foreign securities listings, information technology infrastructure planning and management experience, etc.
The MOUs signed with other exchanges have effectively supported the establishment of sound capital markets in emerging markets and enabled TWSE to exchange experience with other advanced exchanges. In the future, TWSE will continue to promote solid collaboration with other exchanges in order establish more linkages with international markets and seek mutual benefits and development.
Mr. Lee Sush-Der, the Chairman of TWSE said, “Globalization has been a constant feature of the international capital market and has led to the rise of cross-border trading platforms, as well as cross-border ETF listings and products.”
Mr. Lee continued, “A number of emerging markets have arisen in recent years and have quickly become an important part of the global economy, increasing the range of new products demanded by investors. We will continue to reinforce our cooperation with exchanges in emerging markets, such as Shanghai and Shenzhen. We will also further diversify our products and the promotion of the Taiwan capital market, while protecting investors and maintaining a fair trading environment to support trading volumes and boost the economy.”