John Anderson - Santos - Asia and the northern Australia opportunity
Australia: Head towards opportunity...ASX0016_Trade24_Bro_A4_C4b.indd 1-2 28/10/2014 2:03 pm Explore...
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Australia: Head towards opportunity Explore the advantages of trading the Australian futures market
Transcript of Australia: Head towards opportunity...ASX0016_Trade24_Bro_A4_C4b.indd 1-2 28/10/2014 2:03 pm Explore...
Contact Information:
To hear more about the advantages of trading in the Australian futures market with ASX Trade24, please contact us:
Maurice FarhartSenior Manager, International Business Development
Australia
T: +61 2 9227 0268
M: +61 410 453 494
Andrew MusgraveBusiness Development Manager
Asia
T: +61 2 9227 0211
M: +61 414 392 905
Cynthia TazioliVP, Business Development
North America
T: +1 312 803 5840
M: +1 312 953 5038
James KeeleyBusiness Development Manager
Europe
T: +44 203 009 3375
M: +44 7799 066 842
This document provides general information only and may be subject to change at any time without notice. ASX Limited (ABN 98 008 624 691) and its related bodies corporate (‘ASX’) makes no representation or warranty with respect to the accuracy, reliability or completeness of this information. To the extent permitted by law, ASX and its employees, officers and contractors shall not be liable for any loss or damage arising in any way, including by way of negligence, from or in connection with any information provided or omitted, or from anyone acting or refraining to act in reliance on this information.
The trademarks listed below are trademarks of ASX. Where a mark is indicated as a registered mark it is registered in Australia and also be registered in other countries. Nothing contained in this document should be construed as being any license or right of use of any trade mark contained within the document. ASX Trade24® ASX0016 10/14
From SFE to ASX
1960 Sydney Futures Exchange (SFE) begins trading as the Sydney Greasy Wool Futures Exchange (SGWFE)
1965 SGWFE had become the world’s leading futures market
1978 Gold Futures begin trading on the SFE
1979 First exchange outside the US to list a financial futures contract (90 Day Bank Bill)
1983 Forty-five years after the publication of the first share price index, share price index futures begin trading on the SFE
1987 First foreign exchange to market its futures and options products in the US
1989 SFE launches SYCOM, the first after-hours electronic trading platform in the world
1993 SFE launches overnight options on futures, the world’s first product of its type
1999 SFE closes floor trading and starts ’24 hour’ screen trading
2006 ASX and SFE merge
2010 SYCOM renamed ASX 24
2013 ASX acquires d-cyphaTrade Ltd and forms ASX Energy
2015 ASX introducing Domestic Gas Futures*
asx.com.au/interest-rate-futures Follow us @ASX
Australia: Head towards opportunity
Explore the advantages of trading the Australian futures market
* Subject to Regulatory clearance
ASX0016_Trade24_Bro_A4_C4b.indd 1-2 28/10/2014 2:03 pm
Explore the unique opportunity that exists in Australia
Often the best opportunities emerge in unexpected places. And the window that currently exists in the Australian futures market presents unprecedented trading opportunities.
High volatility
While interest rates around the world remain at all-time lows, the cash rate in Australia hovers around 2.5%,1 with official movements and market speculation giving rise to volatility. This volatility creates the prospect for significant trading opportunities in the market. Elsewhere – in the US, Canada, Europe and the UK for example – rates are expected to remain at around 0.5%, with little movement forecast for the next 12-18 months.
A stable economy
With steady economic growth, strong consumer sentiment, a buoyant housing market and a low unemployment rate, Australia is in an enviable position.
Australian Government debt is just 20% of GDP2 – much lower than many of its global counterparts, many of whom have Government debt levels over 80%. With around 70% of this debt being held by offshore accounts, the Australian futures market can be used to access liquidity in Government debt markets.
In addition, superannuation (saving for retirement) is compulsory in Australia, creating the third largest pool of investable funds in the world – around $1.8 trillion.3 Part of this pool is directed at the Australian futures market for duration management.
The relative value of contracts is high
The high relative dollar value of the minimum bid/offer spread of 0.5 basis points on one 10 Year Bond contract is valued at around AUD$47.4 Similar US contracts are valued at US$16.25 each.
A diverse trading community
The level of proprietary trading in Australia is relatively low, meaning there are more ‘end users’ who regularly access the Australian futures market. This diversity in our trading community creates further opportunities.
New Trader Incentive (NTI) program
ASX offers a New Trader Incentive (NTI) program, which aims to lower the barriers for entry into the Australian market. The NTI program is available to corporations and individuals trading their own funds.
The program allows eligible customers who have not traded the ASX 24 market in the last two years to receive a 100% rebate on the exchange trade fee when trading the ASX benchmark futures and options contracts.
ASX Trade24 – your platform for trading in Australia
If Australia is the destination, then ASX Trade24 is your passport to trading here. As ASX’s proprietary trading platform, ASX Trade24 gives you access to the productslisted on the ASX 24 market. These include:
• Interest Rate Futures and Options
• Equity Futures and Options
• Agricultural Futures and Options
• Energy Futures and Options
1. Reserve Bank of Australia: Cash Rate Target (03 September, 2014), www.rba.gov.au/statistics/cash-rate
2. Trading Economics: Australia Government Debt to GDP 1989-2014, www.tradingeconomics.com/australia/government-debt-to-gdp
3. Australian Trade Commission June 2014, www.austrade.gov.au/digital-benchmark/business.html#anchor8
4. AUD$47 = US$54 (29 September, 2014), Reserve Bank of Australia: Exchange Rates, www.rba.gov.au/statistics/frequency/exchange-rates.html
Longest trading hours
The Australian market has the longest trading hours in the world. ASX Trade24 operates on a 24/6 basis, open 21 hours and 50 minutes every trading day, offering debt, equity index and commodity products and a full suite of trading order management functionalities.
Quality products
Many ASX Trade24 products are rated in the Top 10 globally traded interest rate products, such as our 3 and 10 Year Bonds – which means you have more access to quality products. The three-year contract is now the most actively traded futures on government debt outside the US and Europe.
Equal trading opportunities
The Australian market is a diverse market, one that is not dominated by the Australian banks nor by the domestic OTC market. It’s a level playing field with equal opportunity for domestic and international traders.
The Australian Liquidity Centre (ALC), ASX’s data centre and colocation facility, is purpose-built to provide equal benefit for every customer. ASX Net Global, our fully managed low latency network solution, connects international businesses to the heart of the ALC where every customer is connected to ASX’s matching engines using the same length cable.
Trade on yield not price
Trading is done on yield not price in Australia, with a relatively wide bid-offer spread. This results in a high dollar value of a basis point, offering superior trading opportunities.
Source: Bloomberg
Clearing solutions
We work with clearers to keep the lines of business open. So even if your clearers do not have access to the Australian market, ASX has relationships with clearers who can act on their behalf, including:
º ABN AMRO Clearing Sydney Pty Ltd
º Barclays Bank PLC
º Bell Potter Securities Ltd
º BNP Paribas Securities Services
º Citigroup Global Markets Australia Pty Ltd
º Credit Suisse AG, Sydney Branch
º Deutsche Bank AG
º Goldman Sachs Australia Pty Ltd
º HSBC Bank Australia Ltd
º JP Morgan Markets Australia Pty Ltd
º Macquarie Bank Ltd
º Merrill Lynch (Australia) Futures Ltd
º Morgan Stanley Australia Securities Ltd
º Newedge Australia Pty Ltd
º UBS AG, Australia Branch
0%
1%
2%
3%
4%
5%
6%
2009 2010 2011 2012 2013 2014
AUS
USA0%
1%
2%
3%
4%
5%
6%
Australian and USA 3 Year Government Yields
Explore the advantages of trading the Australian futures market with ASX Trade24.Find out more at www.asx.com.au/interest-rate-futures
ASX0016_Trade24_Bro_A4_C4b.indd 3-4 28/10/2014 2:03 pm
Explore the unique opportunity that exists in Australia
Often the best opportunities emerge in unexpected places. And the window that currently exists in the Australian futures market presents unprecedented trading opportunities.
High volatility
While interest rates around the world remain at all-time lows, the cash rate in Australia hovers around 2.5%,1 with official movements and market speculation giving rise to volatility. This volatility creates the prospect for significant trading opportunities in the market. Elsewhere – in the US, Canada, Europe and the UK for example – rates are expected to remain at around 0.5%, with little movement forecast for the next 12-18 months.
A stable economy
With steady economic growth, strong consumer sentiment, a buoyant housing market and a low unemployment rate, Australia is in an enviable position.
Australian Government debt is just 20% of GDP2 – much lower than many of its global counterparts, many of whom have Government debt levels over 80%. With around 70% of this debt being held by offshore accounts, the Australian futures market can be used to access liquidity in Government debt markets.
In addition, superannuation (saving for retirement) is compulsory in Australia, creating the third largest pool of investable funds in the world – around $1.8 trillion.3 Part of this pool is directed at the Australian futures market for duration management.
The relative value of contracts is high
The high relative dollar value of the minimum bid/offer spread of 0.5 basis points on one 10 Year Bond contract is valued at around AUD$47.4 Similar US contracts are valued at US$16.25 each.
A diverse trading community
The level of proprietary trading in Australia is relatively low, meaning there are more ‘end users’ who regularly access the Australian futures market. This diversity in our trading community creates further opportunities.
New Trader Incentive (NTI) program
ASX offers a New Trader Incentive (NTI) program, which aims to lower the barriers for entry into the Australian market. The NTI program is available to corporations and individuals trading their own funds.
The program allows eligible customers who have not traded the ASX 24 market in the last two years to receive a 100% rebate on the exchange trade fee when trading the ASX benchmark futures and options contracts.
ASX Trade24 – your platform for trading in Australia
If Australia is the destination, then ASX Trade24 is your passport to trading here. As ASX’s proprietary trading platform, ASX Trade24 gives you access to the productslisted on the ASX 24 market. These include:
• Interest Rate Futures and Options
• Equity Futures and Options
• Agricultural Futures and Options
• Energy Futures and Options
1. Reserve Bank of Australia: Cash Rate Target (03 September, 2014), www.rba.gov.au/statistics/cash-rate
2. Trading Economics: Australia Government Debt to GDP 1989-2014, www.tradingeconomics.com/australia/government-debt-to-gdp
3. Australian Trade Commission June 2014, www.austrade.gov.au/digital-benchmark/business.html#anchor8
4. AUD$47 = US$54 (29 September, 2014), Reserve Bank of Australia: Exchange Rates, www.rba.gov.au/statistics/frequency/exchange-rates.html
Longest trading hours
The Australian market has the longest trading hours in the world. ASX Trade24 operates on a 24/6 basis, open 21 hours and 50 minutes every trading day, offering debt, equity index and commodity products and a full suite of trading order management functionalities.
Quality products
Many ASX Trade24 products are rated in the Top 10 globally traded interest rate products, such as our 3 and 10 Year Bonds – which means you have more access to quality products. The three-year contract is now the most actively traded futures on government debt outside the US and Europe.
Equal trading opportunities
The Australian market is a diverse market, one that is not dominated by the Australian banks nor by the domestic OTC market. It’s a level playing field with equal opportunity for domestic and international traders.
The Australian Liquidity Centre (ALC), ASX’s data centre and colocation facility, is purpose-built to provide equal benefit for every customer. ASX Net Global, our fully managed low latency network solution, connects international businesses to the heart of the ALC where every customer is connected to ASX’s matching engines using the same length cable.
Trade on yield not price
Trading is done on yield not price in Australia, with a relatively wide bid-offer spread. This results in a high dollar value of a basis point, offering superior trading opportunities.
Source: Bloomberg
Clearing solutions
We work with clearers to keep the lines of business open. So even if your clearers do not have access to the Australian market, ASX has relationships with clearers who can act on their behalf, including:
º ABN AMRO Clearing Sydney Pty Ltd
º Barclays Bank PLC
º Bell Potter Securities Ltd
º BNP Paribas Securities Services
º Citigroup Global Markets Australia Pty Ltd
º Credit Suisse AG, Sydney Branch
º Deutsche Bank AG
º Goldman Sachs Australia Pty Ltd
º HSBC Bank Australia Ltd
º JP Morgan Markets Australia Pty Ltd
º Macquarie Bank Ltd
º Merrill Lynch (Australia) Futures Ltd
º Morgan Stanley Australia Securities Ltd
º Newedge Australia Pty Ltd
º UBS AG, Australia Branch
0%
1%
2%
3%
4%
5%
6%
2009 2010 2011 2012 2013 2014
AUS
USA0%
1%
2%
3%
4%
5%
6%
Australian and USA 3 Year Government Yields
Explore the advantages of trading the Australian futures market with ASX Trade24.Find out more at www.asx.com.au/interest-rate-futures
ASX0016_Trade24_Bro_A4_C4b.indd 3-4 28/10/2014 2:03 pm
Contact Information:
To hear more about the advantages of trading in the Australian futures market with ASX Trade24, please contact us:
Maurice FarhartSenior Manager, International Business Development
Australia
T: +61 2 9227 0268
M: +61 410 453 494
Andrew MusgraveBusiness Development Manager
Asia
T: +61 2 9227 0211
M: +61 414 392 905
Cynthia TazioliVP, Business Development
North America
T: +1 312 803 5840
M: +1 312 953 5038
James KeeleyBusiness Development Manager
Europe
T: +44 203 009 3375
M: +44 7799 066 842
This document provides general information only and may be subject to change at any time without notice. ASX Limited (ABN 98 008 624 691) and its related bodies corporate (‘ASX’) makes no representation or warranty with respect to the accuracy, reliability or completeness of this information. To the extent permitted by law, ASX and its employees, officers and contractors shall not be liable for any loss or damage arising in any way, including by way of negligence, from or in connection with any information provided or omitted, or from anyone acting or refraining to act in reliance on this information.
The trademarks listed below are trademarks of ASX. Where a mark is indicated as a registered mark it is registered in Australia and also be registered in other countries. Nothing contained in this document should be construed as being any license or right of use of any trade mark contained within the document. ASX Trade24® ASX0016 10/14
From SFE to ASX
1960 Sydney Futures Exchange (SFE) begins trading as the Sydney Greasy Wool Futures Exchange (SGWFE)
1965 SGWFE had become the world’s leading futures market
1978 Gold Futures begin trading on the SFE
1979 First exchange outside the US to list a financial futures contract (90 Day Bank Bill)
1983 Forty-five years after the publication of the first share price index, share price index futures begin trading on the SFE
1987 First foreign exchange to market its futures and options products in the US
1989 SFE launches SYCOM, the first after-hours electronic trading platform in the world
1993 SFE launches overnight options on futures, the world’s first product of its type
1999 SFE closes floor trading and starts ’24 hour’ screen trading
2006 ASX and SFE merge
2010 SYCOM renamed ASX 24
2013 ASX acquires d-cyphaTrade Ltd and forms ASX Energy
2015 ASX introducing Domestic Gas Futures*
asx.com.au/interest-rate-futures Follow us @ASX
Australia: Head towards opportunity
Explore the advantages of trading the Australian futures market
* Subject to Regulatory clearance
ASX0016_Trade24_Bro_A4_C4b.indd 1-2 28/10/2014 2:03 pm
