Bursa Malaysia Annual Report 2015

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FROM THE BOARD OF DIRECTORS AND SENIOR MANAGEMENT
37 Bursa Malaysia • Annual Report 2015
CEO’S MESSAGE
AND MANAGEMENT
DISCUSSION AND ANALYSIS
DERIVATIVES MARKET
TRADERS LEVERA GE ON CO MMODITY AND PRICE VOLATILI TY
Interest i n derivatives products was l ed by trading in FCPO and FKLI
contracts, whi ch contributed to historic highs for total contr acts traded
daily, breaching the 100,000 contr acts mark in two days in August. The
Derivatives Market posted a historic month high in August 2015 with the
total number o f contracts traded reach ing 1,411,176 contracts.
BUILDI NG SUSTAINABLE C OMMUNITIES: RE ACHING OUT AND ENGAGING
WITH OUR STAKEHOLDERS
Bursa Malaysia continued to prioritise the recruitment of new Locals, i.e.
professional derivatives tra ders trading their own accounts, to build a more
vibrant trading environment for the Deri vatives Market . Locals have grown
alongside the Exchange o ver the years, both in terms of numbers and
trading participation in derivatives products. We recruited 34 new Locals in
2015 bringing the total number of active Locals to 167.
EDUCATION AND ENGA GEMENT
Our engagement teams c onducted education and net working sessions at
local and international events, reaching out to a total of 15,920 individuals
and 1,286 institutions.
Derivatives trading is still relatively new to cer tain investor segments,
particularly among the younger generation. We leveraged on our annual
events and conferences i ncluding the Palm and La uric Oils Conference
2015, the Gold & Precious Metals Price Outlook Symposium 2015 and the
Financial Markets Outlook Conference 2015 to build netwo rks and better
engage the tra ding community. Th ese interactions between the various
stakeholders are key in building a sustain able marke tplace, and help the
Exchange bette r understand stakeholder requirements and co ncerns.
EDUCATION & RECRUITMENT
new Locals
recruited 34
total active Locals
in 2015 167
60 Derivatives Day
events held
Over
MARKET DEVELOPMENT INITIATIVES
Bursa Malaysia reached a key milestone when it was registered as a FBOT for
Direct Market Access in the US.With this approval, BMD’s identified members
and other participants located in the US may now enter trades directly onto its
electronic trading platform on CME Globex to trade BMD products.
This is particularly appealing to US traders wishing to trade in palm oil futures,
as the Ringgit-denominated FCPO is the global benchmark for the commodity.
We are pleased to see the entry of eight new US trading clients in 2015.
BMD was awarded the “Best Emerging Exchange of the Year” at the Futures
& Options World Awards for Asia in September 2015. The award follows
the recognition granted by the CFTC that Bursa Malaysia possesses the
attributes of an organised exchange and adopts comparable practices for
market integrity and customer protection.
MOVING FORWARD
BursaMalaysia is seeking recognition as a third-country central counterparty
(“TC-CCP”) under the European Markets Infrastructure Regulation regime.
We have made a submission to the European Securities Market Authority
for the recognition and, if approved, our recognition as a TC-CCP will enable
derivatives traders within the European Union to trade derivatives contracts
on Bursa Malaysia with our local market acting as the focal point for all
transactions. The impact of this recognition will be similar to the approval
of our registration with the CFTC and will serve to significantly broaden
market access.
In addition, we will be looking to attract a greater number of trading
participants into our Derivatives Market by leveraging on our initiative
to decouple clearing participantship from trading participantship. The
decoupling of the participantships will widen the class of participants in the
market, potentially further opening our market to the region.