General Announcement::SGX Launches Asia's First Portfolio Compression Service for Listed Derivatives

Issuer & Securities

Issuer/ Manager
SINGAPORE EXCHANGE LIMITED
Securities
SINGAPORE EXCHANGE LIMITED - SG1J26887955 - S68
Stapled Security
No

Announcement Details

Announcement Title
General Announcement
Date &Time of Broadcast
26-Jun-2019 17:08:15
Status
New
Announcement Sub Title
SGX Launches Asia's First Portfolio Compression Service for Listed Derivatives
Announcement Reference
SG190626OTHR5KGN
Submitted By (Co./ Ind. Name)
Jo-Ann
Designation
Senior Associate, Marketing & Communications
Description (Please provide a detailed description of the event in the box below)
Singapore Exchange (SGX) is the first exchange in Asia to extend a portfolio compression service from over-the-counter (OTC) products to listed derivatives. The service is launched in collaboration with Capitalab, a division of BGC Brokers LP, an entity within the BGC Partners, Inc. (NASDAQ: BGCP) group of companies.

Michael Syn, Head of Derivatives at SGX, said; "SGX and Capitalab are responding to market participants' need for an efficient service to optimise their outstanding positions with increased capital and cost savings. In 2014, SGX was the first Asian exchange to run compression on OTC derivatives. Today, we are again leading the way by extending portfolio compression onto listed Asian derivatives."

David Bachelier, co-founder of Capitalab, says; "We are delighted to enter the equity derivatives space, where we believe there is much to be done in optimisation of notional exposures and margins. This first execution in a new asset class celebrates Capitalab's innovative DNA in collaboration with SGX and our clients."

SGX is offering portfolio compression of the listed Nikkei suite of contracts comprising the SGX Nikkei 225 Index Options, SGX Nikkei 225 Index Futures and SGX Mini Nikkei 225 Index Futures.

Portfolio compression is a risk-reduction technique that enables participants to lower capital costs and reduce open positions of derivatives that carry some of the highest cost of capital per unit of notional exposure in the industry. The service has been widely used by participants in the OTC derivatives markets. During the period 2014-2017, SGX ran compression exercises for its OTC financial derivatives tearing up a total of US$135 billion which is equivalent to 39% of outstanding positions.

Attachments

20190626_SGX_Launches_Asias_First_Portfolio_Compression_Service_for_Listed_Derivatives.pdf
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