SGCEX Makes Significant Progress
Online, September 1, 2011 (Newswire.com) - SGCEXTP™ will offer a visible marketplace for trading any type of asset-based derivatives. The new trading system will operate on SGCEX high-performance trading platform.
Subject to regulatory approval, SGCEX will offer physical delivery in Singapore of certain commodities traded on the Exchange, meaning that when a futures contract expires, the seller is obliged to deliver the physical commodity to the buyer at an agreed delivery point licensed by the Exchange. Initially, metal commodities traded on the Exchange will be stored in a facility guarded by some of the world's most high-tech security systems. Later, circumstances and regulatory regimes permitting, SGCEX certain commodities may be deliverable in other financial centres of the world.
Further commodities to be traded on the Exchange may be either physically delivered or financially settled, or both, depending on the shape of market demand and the regulatory environment. Worldwide, less than 1 per cent of futures contracts go to physical delivery; financially settled futures contracts are paid out in cash rather than in the underlying commodity.
The Exchange has grown exponentially since its launch. Key senior executives have been hired in recent months, filling out a management team that represents more than a century of market experience. The Exchange's headcount is forecast to continue rising sharply before trading is launched.
Technology is crucial to SGCEX's attractiveness to market participants. The Exchange operates two fully redundant Data Centres, which play a key role in SGCEX's competitive advantage. No single power failure or telecommunications disruption can affect trading on the Exchange.
SGCEX's industry-leading technology is designed to offer maximum flexibility and speed to meet the requirements of the most demanding market participants. The infrastructure is built around the trading system, a bespoke architecture built on trading platform technology.
Extensive testing shows that performance is among the fastest in the world. Performance tweaking is still underway and continuing improvements are expected in a standard, which is already world-class.
The Exchange has also established the shape of its corporate governance as it builds a board of directors that will be controlled by independent non-executive directors. Representatives of shareholders and top executives will form a minority of the Board in keeping with SGCEX's adherence to the highest standards of corporate governance.