Gaining critical liquidity is a difficult task for a new
exchange, and while SMX’s first day of activity is
unlikely to set any global records, it was a start.
A total of 162 contracts were traded by 6pm, of which 73
were Gold Futures.
The pattern was different on the exchange’s
second day. The most active instrument was WTI Crude Oil
Futures, with 39 contracts traded, worth $2.84m. Twenty-six
EUR/USD Futures were traded, worth $829,000, and six physically
settled 1kg Gold Futures, totalling $241,000.
Each of the FX contracts is for €25,000, while each
1,000-barrel WTI contract is settled in cash against the price
of equivalent Nymex Light Sweet Crude Oil Futures.
On Thursday 26 EUR/USD Futures were traded, six Gold Futures
and 41 WTI contracts. On Friday there were 43 contracts made
for Gold, 10 for EUR/USD and nine for WTI.
Market participants have warned in the build-up to
SMX’s launch that trading volumes may be sluggish
in the short term, as the four risks offered by SMX (the other
is Brent Crude in euros) are successfully listed at other
exchanges, though not in the region.
"It’s not liquidity which will happen today,
and even if it is 10 trades today, we are very happy because
Singapore has the best regulatory mechanism and banking
system," said Jignesh Shah, vice-chairman of SMX and chairman
and group chief executive of its promoter, Financial
While SMX is eager to build liquidity, it is also
considering adding new products. It already has regulatory
approval for a total of 12, and Tom McMahon, CEO, said two
contracts the exchange would add "soon" were futures on the yen
and Australian dollar exchange rates with the US dollar.
McMahon is also considering other commodities, including
crude palm oil and copper.