The remodeled Clearing Fund is designed to be scalable, catering to market growth and development. The changes also reinforce the robustness of the Clearing System.

The new structure more closely links members’ clearing contributions to the volume of risks they bring to the clearing house. Clearing members’ security deposits will begin at a minimum amount of US$500,000. The previous cap on further assessments of S$8 million per member is now revised to a maximum of three times the member’s security deposit.

The revised SGX-DC Clearing Rules will be available on the SGX website on 10 May 2010.

Subject to regulatory approval, the targeted launch date for the U.S. dollar denominated futures and options on futures contracts will be in the second half of 2010.

The EURO STOXX 50 Index is Europe’s most successful equity index. It is weighted by float-adjusted market capitalization, and each component’s weight is capped at 10% of the index’s total free-float market capitalization. The EURO STOXX 50 Index represents 50 supersector leaders in the 12 Euro zone countries Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxemburg, the Netherlands, Portugal and Spain. It captures approximately 60% of the free-float market capitalization of the EURO STOXX TMI Index, and is widely used as an underlying index for financial products globally.

Mr Chew Sutat, Executive Vice President and Head of Market Development at SGX said, “SGX EURO STOXX 50® Index futures and options on futures contracts will provide our market participants with European exposures to manage their risks during the Asian timezone. The listing of this global contract alongside our suite of Asian products provides customers a one-stop access into Asian and European equity markets, and facilitates cross-product arbitrage on different markets.”

“The EURO STOXX 50 Index is not only the leading pan-European index, but also holds the number three position in terms of trading volumes in the global derivatives market as underlying for futures and options contracts,” said Hartmut Graf, chief executive officer, STOXX Limited. “STOXX’s goal is to expand its European success story globally, and licensing our flagship index to the Singapore Exchange is a step on this way.”

This follows SGX’s obtaining of licensing rights from India Index Services & Products Limited (IISL) for the product range including derivative contracts on the CNX Nifty Junior, CNX 100 and CNX Midcap indices. The addition of these products is subject to relevant regulatory approvals. The development comes amid a sharp increase in the trading of India-related products on SGX and elsewhere as the country’s economy continues to be one of the fastest-growing in the world.

Building on the success of SGX’s current offerings, these new India-based products will provide market participants with increased trading opportunities and enhanced means for risk management. Since its launch in 2000, the SGX S&P CNX Nifty Futures has grown to be one of SGX’s key Asian equity derivatives products. Total trading volume in 2009 was 7.1 million contracts, representing a daily average of 29,524 contracts. A new daily record of 297,280 contracts was achieved on 27 January 2010 on the back of an active onshore market and rollover activity.
SGX also lists four exchange-traded funds (ETFs) linked to Indian equity indices on the securities market, namely the db x-trackers S&P CNX Nifty ETF, iShares MSCI India ETF, Lyxor India S&P CNX Nifty ETF and Lyxor MSCI India ETF with combined assets under management of US$782 million as at end-2009. In 2009, total trading value of Indian-based ETFs on SGX surged 48% to S$2.6 billion, underscoring strong investor appetite for Indian assets.

Mr Magnus Bocker, CEO of SGX, said, “We would like to express our appreciation to our customers for their support of our current suite of India-linked products. As we continue to find ways to meet customers’ growing interest in the Indian market through our different partnerships, we are very excited to deepen our relationship with IISL with this planned expansion of our suite of Indian equity derivatives. This will complement our current offerings and bolster SGX’s position as a one-stop gateway for international market participants to manage their Indian investment, trading and hedging needs.”

Mr Ravi Narain, Chairman of the Board of Directors of IISL and Managing Director & CEO of the National Stock Exchange of India Limited, said, “SGX has achieved a solid track record with Nifty futures contract. We are pleased to see SGX’s interest in expanding the range of products based on the Nifty family of indices. This is testament to the international brand recognition of the Nifty index. Today, the Nifty is used extensively by investors in India and around the world to take exposure to the Indian equities market. The total trading volume of Nifty-linked Futures on NSE in 2009 was 167 million contracts, representing a daily average of 687,000 contracts and the trading volume of Nifty-linked Options on NSE in 2009 was 321 million contracts representing a daily average of 1,321,000 contracts Index derivatives based on Nifty have been very successful both in India and in Singapore over the last few years. Further, ETFs and structured products on Nifty have been successfully introduced in US, European and Asian markets by leading ETF providers and investment banks. Nifty has become the true benchmark of the Indian capital market.”

SunGard’s Global One is a suite of application modules that create an integrated solution to help meet the needs of international securities financing, covering principle and agency trading and settlement. Global One integrates with BOCI’s technical architecture, which helped accelerate time to market. In addition to using Global One to manage its core lending program, BOCI uses the solution’s Global View reporting tool to produce a suite of tailored reports for BOCI clients.

Craig Costigan, executive vice president and general manager, securities finance for SunGard’s capital markets and investment banking business, said, “We are pleased to be a component of BOCI’s business growth in securities lending. BOCI’s implementation of Global One demonstrates that SunGard’s solutions and business experience are able to help customers successfully launch and grow their securities lending programs.”

If we look at the second scenario where the name sold down 62% there was clearly a problem with pre-trade risk being poorly instituted despite the erroneous price entered by the trader. Where should the blame lie? With Citi or the Exchange? Apparently, the trader received 2 system warnings before pushing the order through but if the ASX likes to keep markets orderly and fair you would think that the exchange would have rejected this order all together. Some exchanges will only let you enter orders within a certain number of spreads of the last price or they are rejected. Also, the ASX doesn’t have any circuit breaker limits where prices moving above or below a certain percent will cause a trading halt. Of course it’s the members responsibility to ensure that orders don’t cause these kinds of scenarios to take place.

Some exchanges (and the ASX is one of them) don’t allow market orders designed to prevent adverse price movements in securities so, instead, clients will place aggressive limit orders to make sure they complete the trade. While this was not the case with the futures order there was nothing that Citi could have been done to prevent this trading error from happening save the correct price being entered to begin with. However, 250 lots is quite a large order though (AUD 230 million notional and ~4% ADV) so a “fat finger” limit at either the firm level or at the trader level could (should) have been put in place to reduce the number of contracts per trade. The cost of the trade was AUD1 million but would have been much less with a fat finger limit.

Pre-trade risk is very important indeed and should be seriously and vigorously instituted at every firm otherwise it could cost the firm fines, credibility and the cost to back out errors.

Bursa Malaysia Derivatives will offer white labeled versions of Patsystems J-Trader and Pro-Mark front-ends as options to the trading community who wish to access Bursa Malaysia Derivatives products. Both front-ends are flexible, user-friendly and can be easily deployed over the internet, making the Bursa Malaysia Derivatives market more accessible to the global marketplace.

The OMS will provide Bursa Malaysia Derivatives with high speed order routing, straight through processing and sophisticated pre-trade risk management.

Barry White, Regional Director Asia Pacific, Patsystems, said:
“We are extremely excited to have been selected as the front-end provider for Bursa Malaysia Derivatives’ electronic trading platform. Patsystems has successfully provided technology services to members of Bursa Malaysia Derivatives, which has resulted in greater volume for the exchange. We look forward to expanding this partnership and working closely with the exchange as their technology evolves to further increase the liquidity and accessibility of their market.”

Chong Kim Seng, Chief Executive Officer of Bursa Malaysia Derivatives Berhad, a subsidiary of Bursa Malaysia Berhad said:
“Patsystems was selected by Bursa Malaysia after an extensive formal bidding process. The exchange ultimately chose Patsystems because of the accessibility and flexibility of their front-end technology which is an essential requirement for supporting our future growth plans.”

With ‘Live streaming quotes for SENSEX companies’ one can view on a real-time basis, best bid and ask quotes and stock price movements for each of the scrips in the SENSEX, which is India’s benchmark stock Index. ‘BSE SENSEX MOBILE STREAMER’ allow investors to access streaming SENSEX data at their fingertips. The second-by-second movement updates on stocks will help the investors make critically timed trades. The ‘BSE SENSEX MOBILE STREAMER’ can be accessed at http://www.bseindia.com/sensexstreamer.jad. The software is easily downloadable on GPRS activated SIM Cards and Java enabled handsets.

Madhu Kannan, MD & CEO, BSE, said, “Having access to real-time quotes is imperative for investors who wants to take informed decisions for their investments in the Capital Market. BSE is proactively making available the critical information to the investors’ on their mobile phones free of cost. We look forward to adding more features and functionality improvements over the coming months.”

SunGard’s Stream Gateways are integrated with its post-trade derivatives processing solutions, including Stream Clearvision, Stream Ubix, Stream GMI and Stream Options Watch. Developed in Java and based on industry standards such as FIX messaging, SunGard’s Stream Gateways can be delivered in a number of different technical environments including Windows, UNIX and Linux. Leveraging a scalable architecture, multiple gateways can be installed for a single exchange to help support increased trading volumes.

Yassine Brahim, president of SunGard’s global trading business, said, “SunGard’s customers in the post-trade derivatives environment continue to face challenges in terms of scalability, performance and efficiency. The adoption of our new SGX and EDX Stream Gateways reflects the growing need for improved clearing performance and efficiency in the derivatives space, and mirrors the success of our TOCOM and OCC gateways. Stream Gateways were launched in June 2009 and five are now live for TOCOM, OCC, LME, SGX and EDX.”

Hui Yukmin, a spokesman for the bank’s Hong Kong office, told Bloomberg that RBS is looking to “enhance its existing platform” in China through the creation of such a division.

She said that RBS is currently holding talks with an unnamed Chinese company about setting up a joint venture.

If the deal goes through, the bank will join other financial institutions which have expanded their operations in China in recent times.

Firms involved in the country include Deutsche Bank and Credit Suisse, while Goldman Sachs and UBS AG have also set up securities operations.

Last month, RBS announced losses of £3.6 billion ($5.5 billion) in its annual results for 2009 – a figure better than many analysts expected for the British bank.

Source: Bobsguide

Overseas investors would be able to engage in the stock index futures trading under the status of Qualified Foreign Institutional Investors (QFII), said Zhu Yuchen, general manager of the China Financial Futures Exchange and a deputy to the 11th National People’s Congress.

The overseas investors should comply with the overall investment quota of 30 billion U.S. dollars under the QFII program, he said.

According to Zhu, China is to launch index futures for the Shanghai Stock Exchange 50 and the Growth Enterprise Market in the future.

Rules that would allow funds to enter the stock index futures market are also in the making and are expected to be publicized soon, he said.

The China Securities Regulatory Commission approved the launch of stock index futures, along with margin trading, on Jan. 8, and launched the trading accounts on Feb. 22.

The regulator said in January that it would take about three months to prepare for the official start of stock index trading, and Zhu said the time table had not changed.

Source: Xinhua.net