Last month we celebrated the one-year anniversary of the go-live of a new derivatives trading platform at the Australian Securities Exchange (ASX). To facilitate further growth for its ASX24 market, ASX replaced a proprietary trading platform with Cinnober’s globally renowned solution, launched on March 20, 2017. Since then, operations have run successfully with 100% uptime.
ASX offers a full suite of exchange services, including listing, trading, clearing, and settlement, across a wide range of asset classes, and it is the first major financial market to open every day. The ASX24 derivatives market trades interest rate, equity, agricultural and energy future and options contracts, making it the largest in Asia and amongst the biggest in the world.
Some of the products, including ASX three and ten-year bond contracts, are rated in the top ten globally traded interest rate products and the three-year contract is the most actively traded futures on government debt outside the US and Europe.
ASX selected Cinnober in 2015 to modernize its trading infrastructure — to simplify onboarding of new clients by using global standards, improve performance, and speed up launches of new products.
“We now have a contemporary, robust solution, offering global standards and supporting product development and continued growth of member firms and trading volumes”
With the TRADExpress Trading System, Cinnober could offer ASX a functionally-rich, proven product, which was cost-efficient to operate, offering global standards for connectivity. And importantly, it supported necessary customizations to preserve unique features of the ASX market model.
The implementation of the trading system took a year, involving customization of some of the matching algorithms and spreads to not jeopardize important aspects of ASX’s current market model.
During the implementation project, ASX took a proactive approach with its customers who were involved in an extensive testing and certification program. Rather than rushing for launch, readiness was prioritized as well as consideration to bond roll and freeze periods, and from project kickoff in April 2015, the new platform was launched on March 20, 2017.
The new ASX 24 trading system, called NTP (New Trading Platform), provides ASX’s clients with a low-latency solution, and enables fast time-to-market for new products and services. It is a high-performance solution capable of handling massive volumes, such as peaks during bond roll. Using the global standard protocol FIX, it allows for quick and easy onboarding of new market participants. NTP has been well received by the market, showing great stability without operational disturbances.