Presentation to Japan Securities Summit11 March 2010
Singapore Exchange
Wai Kwong SECKSenior Executive Vice President & Chief Financial OfficerSingapore Exchange
2
SGX’s Revenue Distribution
47%28%
4%
21%Derivatives
Securities
Domestic1H FY10: 51%
Asian Gateway1H FY10: 49%
3
Asian Gateway Products
Xinhua A50 Futures
MSCI Taiwan Futures
219 listings:
155 China
47 Hong Kong
17 Taiwan
Asian GatewayAsian Gateway
Structured Warrants
CNX Nifty Index Futures
4 listings
MSCI India ETF
S&P Nifty ETF
Capital Raising PlatformsCapital Raising Platforms
Risk Management CentreRisk Management Centre
IndiaGreater China
Nikkei Index Futures
Apex50 /Euroyen/JGB/SIMSCI
66 listings:
57 S.E. Asia;7 Japan;2 Korea
Japan, Korea & ASEAN ETF
Structured Warrants
Rest of Asia- Equity Index Futures NIFTY / MSCI TAIWAN / NIKKEI / SIMSCI
- Investment Funds REITS / Business Trusts / Certificates / ETF’s
- Optionality Warrants / MSCI TAIWAN Options / NIKKEI Options / SIMSCI Options
- Single Stock Mainboard / Catalist / Extended Settlement
- Asset Classes AsiaClear Commodities / Interest Rate Futures / Bonds / Sicom Rubber
4
Securities Market Overview
Key drivers Metrics
Daily Average Trading Value $1.6B
Daily Average Trading Volume (shares) 1.8B
Turnover Velocity 62%
Market Capitalisation $669B
No. of Listed companies, REITs, Funds & Hedge Funds 773
ETFs 49
No. of Bonds 1186
5
Securities Market Turnover
Monthly Trading Value (In billion)
Straits Times Index (STI)
05
101520253035404550
Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-100
500
1,000
1,500
2,000
2,500
3,000
3,500
Monthly Trading Value (In billions) STI
6
Securities Market ActivityProduct Turnover (Dec 09) Listings
At end of Dec 09
7
Derivatives Market Overview
Key drivers Metrics
Daily Average Volume (contracts) 214,000
Algo participation 25%Extended trading hours Till 1.00 amDT contracts
Futures 18Options 7Structured warrants 315
Extended settlement contracts 68
SICOM contractsCommodities futures 2
AsiaClearâ
Swaps contracts 28
8
Derivatives Market Activity
0
50
100
150
200
250
300
0.00.51.01.52.02.53.03.54.0
Jan/
08
Mar
/08
May
/08
Jul/0
8
Sep/
08
Nov
/08
Jan/
09
Mar
/09
May
/09
Jul/0
9
Sep/
09
Nov
/09
Ope
n In
tere
st (t
hous
ands
)
Volu
me
(mill
ions
)
Volume Open Interest
Nikkei 225 Index Futures Volume and Open Interest
010203040506070
0
5
10
15
20
25
Sep-
08O
ct-0
8N
ov-0
8D
ec-0
8Ja
n-09
Feb-
09M
ar-0
9Ap
r-09
May
-09
Jun-
09Ju
l-09
Aug-
09Se
p-09
Oct
-09
Nov
-09
Dec
-09 Ope
n In
tere
st (T
hous
ands
)
Aver
age
Dai
ly V
ol.
(Tho
usan
ds)
Average Daily Vol. Month-end Open Interest
MSCI S’pore Index Futures Volume and Open Interest
MSCI Taiwan Index Futures Volume and Open Interest
050100150200250300350400450500
01020304050607080
Dec
-07
Feb-
08
Apr-
08
Jun-
08
Aug-
08
Oct
-08
Dec
-08
Feb-
09
Apr-
09
Jun-
09
Aug-
09
Oct
-09
Dec
-09
Ope
n In
tere
st (T
hous
ands
)
Aver
age
Dai
ly V
ol.
(Tho
usan
ds)
Average Daily Vol. Month-end Open Interest
S&P CNX India Index Futures Volume and Open Interest
0
50,000
100,000
150,000
200,000
250,000
0
20,000
40,000
60,000
80,000
100,000
Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09
Ave
rage
Dai
ly V
olum
e
Average Daily Volume Open Interest
9
Exchange Industry
• Trends Driving Change
• Mobility of global capital
• Customers Need to Manage Risk: Product innovation
• Technology
• Pressure on Costs/Choice: Consolidation/new entrants
• Regulatory changes
=> Increasingly intense competition
10
SGX Strategy
• What SGX has done
• Mobility of Capital - Asian Gateway
• Product innovation – Single Stock Futures, Fuel Oil, Gold
• Technology – Upgrade systems
• Consolidation and new entrants – Chi-East, Extended Trading Hours
• Regulatory changes – OTC Clearing
11
Key Technology Milestones
• Securities MarketNew Trading Engine, QUEST-ST (July 2008)Prime Pre-Settlement Matching Service, PSMS (Oct 2008)
• Derivatives MarketData Engine, SGXDE-DT (Jan 2008)Upgraded Trading Engine, QUEST-DT (Dec 2008)Derivatives Clearing, SECUR-DC (Dec 2009)
• Other ServicesNew Website (Feb 2009)
Going forward SGX is investing in technology to support OTC clearing of financial products and other areas like Risk Management.
12
Prospects
Areas of Potential Growth:
• Algo Trading
• Dark Pools
• OTC Clearing
• Foreign Listings/Catalist
• Commodities
13
Thank You