The Singapore Exchange (SGX) has added a number of new American depository receipts (ADRs) to its GlobalQuote board as part of efforts to reinvigorate trading on its market.
On 29 December, SGX added 15 new ADRs of companies spanning Europe and Asia that are also listed on US exchanges NYSE Euronext and Nasdaq OMX. The stocks include France’s Total and Alcatel Lucent, Norwegian gas and oil company Statoil and the UK-based telecoms company Vodafone.
The new ADRs which have a combined market capitalisation of over US$1 billion are fully transferable with their requisite US listing, allowing investors to manage exposure to these securities during both US and Asian trading hours.
“For the first time, investors will be able to manage exposures to these global companies during the Asian time zone, when increasingly relevant news flow is likely to occur for these companies with significant businesses in Asia,” commented Nels Friets, head of securities, SGX. “GlobalQuote offers the only on-exchange platform in Asia for this purpose and SGX looks forward to bringing more of such offerings to customers.”
SGX will hope the new ADR issues stimulate trading on GlobalQuote this year. According to the exchange’s own figures for 2011, which are currently only available through November, trading on GlobalQuote – which first launched in October 2010, reached S$1.899 billion in the first 11 months of last year, drastically lower than the S$4.395 billion recorded in 2010.
SGX has also released a public consultation paper on the removal of iceberg order functionality from its derivatives and securities market due to low trading volumes.
The removal of the iceberg order, which helps investors to reduce the market impact they create when trading large orders, is subject to approval from regulator the Monetary Authority of Singapore and is scheduled to take place some time in Q1 2012.
According to SGX, only 2,194 iceberg orders were used for securities trading between January and November 2011, compared to a total of 239.68 million total orders during the same period.
The exchange operator added it expected the removal of iceberg orders to have a minimal impact on its members because of its limited usage and the availability of alternative execution functionality. SGX also jointly operates Chi-East, a pan-Asian dark pool it established with alternative trading venue operator Chi-X Global.