While revealing a series of successes in new data offerings and technology upgrades, flat half-year results at the Australian Stock Exchange (ASX) also expose disappointment in some of its new venue strategies.
Cash market revenue – consisting of trading, clearing and settlement – was A$66.9 million (US$71.9 million) for the first six-month period of its 2012 trading year, up barely 0.2%. This was driven by a strong first quarter, followed by a significant reduction in market activity in the second quarter.
Trading revenue of $19.6 million (US$21 million) was in line with last year, despite a decline in traded value of 4.7% to A$643.9 billion (US$692.8 billion), off the back of the launch of alternative venue Chi-X Australia.
While not expanding on the details, the bourse admitted use of VolumeMatch – a block trading venue with a minimum order size of A$1 million – has been “unsuccessful”.
VolumeMatch is one leg of the ASX’s new multi-platform strategy that also includes the introduction of PureMatch – a dedicated venue for high-frequency trading with a latency of 300 microseconds and a capacity of 100,000 orders per second – and TradeMatch, a platform catering for the bourse’s traditional customers.
In its H1 filings, the ASX said VolumeMatch’s design and distribution model was now under review.
For PureMatch, currently undergoing a pilot programme, the exchange said it was “too early to determine impact” but that “new low latency data products [were] in delivery”.
ASX said CentrePoint – the bourse’s dark trading service – was “gaining traction” and enhancements would be delivered by mid-year.
Revenue from the provision of trade execution and data services was up 19.5% to A$22.6 million, including revenue from its new co-location offering, its high capacity and low latency optical fibre network ASX Net, and ASX Best – its multi-market trading application with a smart order router.
ASX opened the Australian Liquidity Centre, its new data and co-location centre in February 2011 and expects the facility to be fully operational by the end of April. Equities has already been launched and the bourse said it would begin futures commencing later this month.