The automation of stamp duty reporting and payment is aimed at helping to streamline Exchange Participants’ (EPs) operations, reduce paper consumption and further increase the efficiency of HKEx’s securities market. At present, EPs hand deliver their stamp duty reports and cheques for stamp duty payment to HKEx on a daily basis. HKEx estimates it now receives over 120,000 stamp duty reports in an average year so a significant amount of paperwork will be eliminated by the automation.

From 20 September, EPs will submit their stamp duty reports to HKEx via its new web-based Electronic Communications Platform and the stamp duty due will be debited from the EP’s designated bank account automatically. Details of the new procedures for stamp duty reporting and payment are available on the HKEx website.

The implementation date was set following the successful completion of the two market rehearsals in August and confirmation from the EPs that they are ready for the new arrangement.

HKEx would like to thank EPs for their participation in its activities to prepare for automated stamp duty reporting and payment and their support for the automation.

The China Securities Regulatory Commission (CSRC) released its Guidelines for Guaranteed Fund (a draft for discussion) on Monday, which made clear regulations concerning investment strategies, investment ratio, guarantor qualification and other aspects of principal guaranteed funds, the paper said.

According to the guidelines, guaranteed funds to be invested in fixed income products should be no less than 70 percent of the net value of the funds. They are also allowed to invest in stock index futures.

As of the end of June, China has six guaranteed funds in operation, with a total value of 30.49 billion yuan ($4.50 billion).

Source: China Daily

he 2010 International Corn Industry Conference will be held on September 15th in Dalian, and as a cooperating partner to this year’s conference, NYSE Liffe – NYSE Euronext Group’s global derivatives business – will be attending.

The Dalian Commodity Exchange (DCE) and NYSE Euronext signed a Memorandum of Understanding on November 4, 2008. Ms. Zhong said that since the signing of the Memorandum, the two exchanges have established close communication and cooperation. Through staff visits to each exchange, market expansion and promotion, information sharing and product research, the exchanges have been able to strengthen cooperation, and this year’s Corn Industry Conference is just one example of this cooperation.

She also said that the overall level of activity in China’s agricultural futures market has attracted worldwide attention, and the DCE’s trading volume is among the highest in the world. However, compared to the more mature futures markets in Europe and North America, China’s futures market product structure is relatively simple, institutional participation is relatively small, and the functions of the futures market have not yet been fully utilized. Ms. Zhong was quoted saying: “at NYSE Euronext all of our agricultural futures have related options; we have a wealth of experience in option products R&D, service development and market research. We are very willing to work together with the DCE to help develop China’s options market.”

NYSE Liffe is the global derivatives business of the NYSE Euronext group that runs futures and options markets in Amsterdam, Brussels, Lisbon, London and Paris. NYSE Liffe offers over 1,000 different derivative products throughout its various markets.

With its registration, CITIGROUP will become the 35th licensed PO on Bursa Malaysia Securities and will be trading on the equities market.

NZX is launching its Derivatives Market on 8 October 2010 with a Global Whole Milk Powder Futures contract. NZX Global Whole Milk Powder Futures will be a vital tool for the dairy industry worldwide to manage price risk in the most heavily traded milk powder product in the world.

NZX Dairy Futures will be traded on the NZX electronic trading platform, GlobalVision, and centrally cleared through the new clearing house, operated by NZ Clearing Corp.

NZX intends to bring more Dairy Futures and other products to its Derivatives Market in the next 12 months.

During a one year period from December 2007 to December 2008 he changed the volatility values in the firms pricing model to inflate the books value by USD25,000,000.

His crime was discovered when he instructed a junior trader on his desk to use a compromised software program to mark daily the options book during a two month sick leave he had taken. The program was intended to slowly reduce the inflated value during his sick leave.

Earlier this year the HKSFC fined Merrill Lynch HKD3.5 million for a lack of systems and controls that could have prevented this violation citing, among other reasons, “there were inadequate checks and balances over the Book to mitigate operation risks including risks associated with fraud and dishonest activities”

Mr Mark Steward, the SFC’s Executive Director of Enforcement said upon handing out the fine “Licensed corporations must have effective procedures in place to manage risks of trading books. For books that deal in illiquid assets which have low price transparency, more robust measures must be in place. The proper implementation of an effective risk management framework could have enabled Merrill Lynch to detect the mis-marking earlier”

Merrill Lynch has since taken steps to address their oversight policies.

The disciplinary action follows an SFC investigation into mis-marking activities in a trading book in exotics options (Book) at Merrill Lynch.

The SFC’s investigation found that during the period from December 2007 to December 2008, Harchaoui had mis-marked the Book by manipulating the volatility marks in the valuation model, and accessed the computer system without authority to alter pricing parameters on various occasions.

The SFC further found that Harchaoui sought to cover up his action by instructing a junior trader in his team to use a manipulated computer programme to mark the Book on a daily basis during his sick leave. If the manipulated programme had not been uncovered, the mark-up in the Book would have been linearly amortised over the duration of his two-month sick leave.

Harchaoui’s mis-marking activities resulted in the value of the Book being inflated by approximately US$25 million and caused the actual loss in the Book to be wrongly reported to Merrill Lynch.

The SFC earlier took action against Merrill Lynch in relation to regulatory issues arising out of the same incident (Note 2).

In deciding the disciplinary action, the SFC took into account the dishonest nature of Harchaoui’s conduct and the fact that he abused his seniority by instructing his subordinate to implement his mis-marking activities.

Trayport’s GlobalVision Exchange Trading System integrates fully with 3i Infotech’s AWACS solution and it is expected that both systems will link to 3i Infotech’s Tradis online broker workstation and order routing system later this year.

“The new exchange trading platform allows us to monitor clients’ positions and margin management, market exposure and trading limits,” said Lukas Lauw, Head of Trading and IT at Jakarta Futures Exchange. “We are pleased with the way the systems have been deployed so quickly and effectively. The support provided by both Trayport and 3i Infotech has been first rate and allowed us to make the change much more easily.”

“GlobalVision Exchange Trading System is being increasingly used by exchanges worldwide,” said Paul Constantinou, Sales Manager for Exchange Systems, Trayport. “The Jakarta Futures Exchange is an important player in commodities trading in Asia and their rapid expansion and move to electronic trading shows its clear objective for the future. More exchanges are looking for integrated trading and risk management systems that improve their futures and derivatives markets. We believe that the Trayport and 3i Infotech approach gives exchanges an advanced trading platform while providing the best fraud and risk monitoring solutions available today.”

“We have already seen an increase in trading volumes as a result of switching to Trayport’s GlobalVision Exchange Trading System. We also expect that when we implement FIX Gateway, it will allow our members to connect their broker systems to the exchange, and so we will see an even greater effect,” said Lukas Lauw. ”The platform already offers members electronic trading of Olein (palm oil) futures and Gold contracts. We will soon add other products including Coffee and Cocoa.”

Bharat SV, 3i Infotech, Western Europe commented, “With the emerging markets playing a crucial role in future global trading volumes, the implementation of advanced trading and risk management systems from Trayport and 3i Infotech, will ensure the Jakarta Futures Exchange has what it needs to meet the demands of a rapidly expanding marketplace, and gain the confidence of new investors. These solutions have the additional advantage of being able to scale up, as the market grows.”

Joseph Kubeyka, Managing Director of Financial Software Systems Inc., Asia Pacific noted, “We are very
excited to partner with a premier institution such as CICC. In today’s challenging trading environment,
Spectrum provides the return on investment required for financial institutions to justify technology projects.
CICC’s selection of Financial Software Systems and Spectrum further validates our leading position in the Asia
Pacific financial technology market.”

With the Apama SOR Accelerator, traders can now create proprietary order routing strategies that intelligently select execution venues from among the many Exchanges, Multi-Lateral Trading Facilities (MTFs) and Dark Liquidity Pools. Importantly, the Apama SOR Accelerator helps both sell-side and buy-side firms address the stringent and complex regulatory demands within India.

The Accelerator combines the most-widely deployed Complex Event Processing (CEP) platform with tools set for both business users and IT developers that enable both buy-side and sell-side trading desks to quickly design, test, deploy and evolve strategies that incorporate unique proprietary algorithmic techniques. The Apama architecture monitors real-time market data and other sources of market information and takes action instantly. Combining development ease and deployment power, the Apama platform is unmatched in the industry. The SOR Accelerator allows traders to create proprietary order routing and select various execution venues including exchanges, multi-lateral trading facilities (MTFs) and dark pools.

“SEBI’s much needed and eagerly awaited decision on allowing Smart Order Routing for every class of investors on the stock exchanges will lead to greater efficiency in the Indian markets. Smart Order Routing will lead to the increased automation and wider adoption of sophisticated order routing technology in Indian capital markets to bring them in line with global markets. We aim to support the overall Indian capital market and the various trading entities in effectively implementing SEBI’s decision with the introduction of the Progress Apama Smart Order Router (SOR) Accelerator”, says Kaushal Mashruwala, Vice President of Progress Software.

Says Mr. Mashruwala, “Smart Order Routing helps to look at markets horizontally instead of the classic algorithmic trading view, i.e. breaking down orders into a single market to minimize impact. A value added benefit to the traders would be having access to a number of markets and visibility to deliver best execution across venues. It also expedites the delivery of trading strategies and incorporates the response to market dynamics.”
The SOR Accelerator is built on three core components:
• Ensuring that there is seamless connectivity, and that accurate information is commuted between the business user and different venues
• Providing clear visibility on market data offerings via real time notifications on the platform
• Aids in understanding and providing a routing logic that helps in ensuring the success of a trading strategy created by the business user

The Apama SOR Accelerator represents one of several Progress Apama initiatives focused on helping both sell-side and buy-side firms trade profitably in markets where liquidity is increasingly fragmented – such as our previously-announced FX Market Aggregation Accelerator (http://www.progress.com/apamafx); an offering that targets the needs of FX traders to get a comprehensive view of diverse FX liquidity and trade across it using a variety of customizable market taking and market making algorithms.