Asias derivatives market has been backed to continue
growing by industry experts who also added caution saying that
it must develop and mature in order to be a true international
Volumes on Asian exchanges are growing at record rates, said
Omar Merican, chief operating officer at Bursa Malaysia during
FOWs Derivatives World Singapore indicating that growth
is set to continue.
We are seeing lots of demand for additional features.
Last year we upgraded our trading platform for derivatives and
this year we are experiencing over a 15% increase in volumes,
and probably the best is yet to come. We are looking forward to
the impact of Direct Market Access which will bring in new
traders who have been asking for access to the market such as
algorithmic traders, he said.
Garry Jones, executive director derivatives business
development and strategy at Liffe, echoed this settlement.
A lot of the growth has been seen of Asian clients into
Asian markets while we have also seen an increase in
international participation in Asian markets, and also Asian
institutions into Europe. With that in mind, when you start to
increase the number of clients with access to the market and
you increase the technology access to the market, the velocity
of trading is going to increase. I think from that perspective
what is important is the links between Asian exchanges and
Europe and the US need to grow to be optimised but obviously
that does depend on technology. Said Jones.
However, Jones warned that for Asian exchanges to become more
successful in the international arena there needed to be
certain changes to the structure. I think the
international links, the infrastructure links and the growth in
technology and finally a more regulatory regime to allow these
changes to happen, I think that it is important that local
exchanges think about the overall picture rather than looking
to be protective, All this will allow Asian exchanges to expand
on the International arena. Jones said.
Some traders have also highlighted the Asian regulatory
structure as a stumbling block behind any restraint in holding
Asian derivatives markets back. India and China both do not
allow foreign trading despite the general consensus that both
countries could become global leaders in the derivatives
Joseph Massey, deputy managing director at Multi Commodity
Exchange of India, highlighted this when speaking at the
conference, but indicated that these rules may be about to
change. Indias regulatory structure means that some
asset classes are not tradable by foreign investors, but
despite this we are still experiencing huge volumes, and we
expect those regulations to be changed very soon, and we expect
to see tremendous volumes once they are, said
Jones also expressed his surprise at the current regulatory
structure that exists, particularly in India. I am not
sure why people are restricted from trading different asset
classes, as if commodities are more volatile than equities when
in fact if you look at the maths, that simply is not
true, said Jones.
Nicolas Bolton, executive director at CME Group, also praised
the regulatory structure that exists in Singapore. It is
important that regulation is clearly defined but it is
important that it does not stop people trading certain
markets, he said.
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