APAC Brokers Expand Connectivity
FCMs are providing access to exchanges worldwide.
Futures commission merchants (FCMs) are building linkages to and from, as well as within, the Asia-Pacific region as trading interest continues to climb.
“Almost all FCMs in the region connect to multiple exchanges,” Mark Fischer, vice president of product management at CQG, told Markets Media. “There are many international FCMs–for instance, MFGlobal and Newedge–whose business model is to provide services for as many exchanges as their customers want. Locally-based FCMs are following the same business model in providing access to exchanges worldwide to the extent that there is demand from their customers.”
CQG, which connects FCMs to exchanges through its worldwide network of co-located CQG Hosted Exchange Gateways, is developing significant FCM partnerships in the APAC region.
A number of new partnerships have been formed, with the most recent additions including DMG & Partners Securities Pte. Ltd. and BOC International. CQG is also in the process of finalizing an agreement with ADMIS Singapore Pte. Ltd., among others, to provide their traders with access to CQG.
“CQG’s unique value proposition is that it provides access to more than forty exchanges worldwide through one connection,” said Fischer. “By utilizing CQG’s services, an FCM can provide connection to any or all of those exchanges easily and quickly.”
CQG is continued expansion in Asia-Pacific with the introduction of hosted connectivity to the Hong Kong Futures Exchange (HKFE).
The addition of HKFE is a clear choice to build upon its growth in the Asia-Pacific markets, which is supported by a robust infrastructure and sales and support offices throughout the region.
CQG began introducing its products and services into APAC by opening an office in Tokyo in 1998 followed by offices in Singapore and Sydney in the 2000s. In recent years, CQG has concentrated on building its customer base in those cities while at the same time extending its offerings into Hong Kong.
The company has been working with partners within the People’s Republic of China and is looking at opportunities in Vietnam, Thailand and Malaysia.
“In the past, CQG’s services in APAC have generally been consumed by North American and European institutions with offices in the APAC region,” said Fischer. “ However, CQG now sees opportunities in these emerging markets from local individuals and institutions, and CQG’s current strategy is to find ways to better serve those local traders.”
In general, the Asian exchanges are aware of the growing interest in their products and are working hard to facilitate the increasing demand. They are doing this by both improving and expanding their technical infrastructure as well as by making their business processes easier for customers, said Fischer.
While many of the APAC exchanges, particularly those in Singapore, Australia, Japan and Hong Kong accept trades and traders from outside their native countries, it is also clear that the mainland China exchanges are reluctant to open their markets to traders from outside China.
“We believe that all markets in the region will eventually be open to traders worldwide,” said Fischer. “However, it is difficult to predict how quickly that will occur.”
Currently, CQG has extensive trading and market data connectivity in Japan, market data coverage in four major Indian exchanges, and trading access in Australia, Malaysia, New Zealand, Singapore, South Korea, and Taiwan.
Contracts will be based on Bloomberg Barclays MSCI Global Green Bond and Euro Corporate SRI indexes.
Trading Technologies has partnered with Chinese clearing broker COFCO Futures.
The exchange's Bitcoin ETN future is most likely not going to be its last.
The exchange's derivatives segment will close for trading on Friday 28 January 2022.
A number of Libor rates will cease to exist at the end of this year.