SGX to upgrade platforms for derivatives

Subject: SGX to upgrade platforms for derivatives Wed Dec 31, 2014 8:55 pm

The Singapore Exchange (SGX) will be upgrading its trading and clearing systems for derivatives, to make them more efficient as that segment of the bourse operator's business grows.

SGX to upgrade platforms for derivatives 20141212_sgx_bt

SGX to upgrade platforms for derivatives 20141212_sgx_bt

The new systems will also lower trading and clearing costs, as well as improve risk controls, the SGX said in a press release yesterday.

The announcement follows a series of technical glitches this year that shook investors' confidence in the bourse and drew rebukes from regulators.

The SGX yesterday declined to disclose how much it would be spending on the upgraded platforms, which will use technology from the Nasdaq OMX Group based in the United States.

Derivatives are financial instruments that derive their value from underlying assets such as stocks and commodities.

The SGX is increasingly relying on its derivatives business for revenue as the volume of securities traded declines.

"We see strong and continued demand for SGX's Asian derivatives, and aim to provide ever better solutions to fulfil these unique and evolving needs," SGX chief executive Magnus Bocker said in the statement.

Noting that it already offers the longest trading hours of any exchange in Asia, the SGX added that the upgraded systems, together known as "SGX Titan", would strengthen the bourse's safeguards to "help market participants manage their trading and clearing positions on a 24- hour basis".

The upgrade is scheduled for completion towards the end of 2016, the exchange said.

It added that it would extend its engagement with Nasdaq for six more years, to support and maintain the Nasdaq systems in its securities and derivatives markets.

The systems upgrade announcement comes a few weeks after the SGX was hit by its second technical glitch in two months, on Dec 3.

On that day, the exchange delayed the start of its securities market trading, citing a software issue.

Last month, a power supply problem halted trading in the securities and derivatives markets for several hours.

The SGX also had to suspend derivatives trading for more than two hours on April 1, owing to a hardware fault.

A report by credit rating agency Standard & Poor's last year said that stock exchanges across the world were suffering more technical glitches lately, likely because their trading systems were becoming more advanced and complex.

The SGX spent $250 million three years ago on a state-of-the-art trading engine that can do transactions 3,000 times faster than the blink of an eye.

http://business.asiaone.com/news/sgx-upgrade-platforms-derivatives
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SGX to upgrade platforms for derivatives

SGX to upgrade platforms for derivatives

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