The Singapore Exchange (SGX) has announced two agreements that will enable it to expand the number of India-related products it can offer for trading.
SGX is planning to offer options based on the S&P CNX Nifty Indian large-cap stock index and related indices in the coming year after receiving licensing rights from India Index Service & Products Limited for the product range, including derivative contracts on the CNX Nifty Junior, CNX 100 and CNX Midcap indices. The addition of these products is subject to relevant regulatory approvals.
SGX said the new Indian products will provide market participants with increased trading opportunities and enhanced means for risk management.
The new offerings will add to SGX’s existing India-based products. Since its launch in 2000, the SGX S&P CNX Nifty Futures offering has grown to be one of SGX’s key Asian equity derivatives products. Total trading volume in 2009 was 7.1 million contracts, representing a daily average of 29,524 contracts.
SGX also lists four exchange-traded funds (ETFs) linked to Indian equity indices on the securities market.
SGX has also signed a memorandum of understanding (MOU) with India’s National Stock Exchange to cooperate in the development of the India-linked products market.
Under the MOU, both exchanges aim to explore future collaboration in the expansion, development and promotion of India-linked products and services to be listed on SGX. Subject to regulatory approval, these products may include equity products and other asset classes. The two exchanges also will look into a bilateral securities trading link to enable investors in one country to trade on the other country’s exchange.
“Our customers have been instrumental to the success of our current range of India-linked products. As part of our Asian gateway strategy, we will continue to work with like-minded partners to explore collaboration opportunities,” said Magnus Bocker, CEO of SGX, in a statement.
In addition, SGX has signed up its first Indian broker member – IIFL Securities, a subsidiary of Indian financial services firm India Infoline – for securities trading and clearing.
Other new securities trading and clearing members announced by SGX include Goldman Sachs Futures and Standard Chartered Securities (Singapore). The exchange has also signed up MF Global Singapore and Cantor Fitzgerald (Singapore) Capital Markets as securities trading members, Deutsche Bank as a securities clearing member, Cantor Fitzgerald (Singapore) Capital markets as a derivatives trading member and United Overseas Bank as a derivatives clearing member.