Australian Securities Exchange
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| Australian Securities Exchange | |
| |
| Founded | July 2006 |
|---|---|
| Headquarters | Sydney, Australia |
| Key People | Robert Elstone, CEO; Alan Bardwell, CFO; Eric Mayne, CSO market supervision; Maurice Newman, chairman |
| Products | Cash equities and warrants; futures on equity indexes and single stocks, interest rates, wool, grains and electricity; equity and index options; and CFDs |
| Web site | http://www.asx.com.au |
The Australian Securities Exchange (ASX) is a multi-asset class electronic platform, formed in 2006 by the merger of the Australian Stock Exchange and the Sydney Futures Exchange, combining cash equities with one of Asia’s largest derivatives operations.
The legacy exchanges have a track record for innovation, and were among the first to demutualize, list their shares and switch to all-electronic trading, which is now offered on a 24-hour basis. The new ASE is a leader in the fast-growing markets for contracts-for-differences (CFDs).
Futures and options volumes for the new exchange rose 16 percent to 92.7m contracts in 2007, while cash market business rose 44 per cent to A$1,600bn[1]
Contents |
History and Merger
The Australian Stock Exchange announced its agreed cash-and-stock offer for the SFE on March 27, 2006, seven years after an abortive takeover was blocked by domestic antitrust officials and the futures exchange walked away from a rival offer.
The offer of 0.51 stock exchange shares for each SFE share valued the futures exchange at A$2.3bn, and was priced at 31.5 times 2006 earnings and a 25 per cent to its average level over the previous 30 days[2]. The transaction closed on July 26, 2006, and the new ASX was officially formed in December 2006[3].
In 1998, the ASX became the first large exchange to demutualize and list its shares, while the SFE demutualized in September 2000 and listed on the ASX in April 2002. The stock exchange traces its roots back to the creation of the Sydney Stock Exchange in 1871, which was combined in 1937 with a number of regional bourses to form the the Australian Associated Stock Exchanges. The SFE was started in 1960 as the Sydney Greasy Wool Futures Exchange, changing its name to the SFE in 1960[4].
Structure and Regulation
The parent ASX Ltd is listed on its own exchange, and incorporates a clearinghouse for exchange-traded and OTC cash and derivative products.
The legacy SFE ranked as the world’s 13th-largest futures exchange by contract volume in 2006, while the stock exchange operator also operated a smaller derivatives platform and listed 2,090 companies with a combined value of A$1,630bn as of June 30, 2007[5].
ASX Ltd reported a 45.6 per cent rise in net profits to A$313.1m in the 12 months to June 30, 2007, its first full year of operation, with operating revenues rising 22.7 per cent to A$552.7m. The cash market remains the largest source of revenues, accounting for 30 per cent in fiscal 2007, with listings adding a further 21 per cent. The derivatives complex accounted for 28 per cent of total revenue. Information services contributed 11 per cent of revenues[6].
The exchange operates under a self-regulatory regime, overseen by the Australian Securities and Investment Commission and the Reserve Bank of Australia[7].
Product Development
The SFE complex spans futures and options in equity, interest rate, agricultural and energy products, with volumes rising from 72.4m to 82.8m in fiscal 2007. The average fee per contract dipped from A$1.45 to A$1.39. Volumes in the smaller legacy ASX complex of futures and options dipped from 23.1m to 22.9m.
Australian Treasury futures dominate the SFE complex, which has been expanded to include a New Zealand government bond contract. The SFE SPI 200 equity-index is the fourth most heavily-traded contract. Agricultural futures include wool and live cattle.
The ASX also offers wool futures and options in an agricultural complex which includes wheat, barley, canola and sorghum. Financial products include futures on the benchmark S&P ASX 50 and 200 indexes[8].
References
- ↑ Press release. ASX. Retrieved on January 22, 2008.
- ↑ Merger Agreement. ASX. Retrieved on December 7, 2007.
- ↑ Press Release. ASX. Retrieved on December 12, 2007.
- ↑ Official History. ASX. Retrieved on December 12, 2007.
- ↑ Volume Growth Accelerates. FIA. Retrieved on December 12, 2007.
- ↑ Press Release. ASX. Retrieved on December 12, 2007.
- ↑ Annual Report 2007. ASX. Retrieved on December 12, 2007.
- ↑ Annual Report 2007. ASX. Retrieved on December 12, 2007.
