Opening Cross: Asia Shows More Eastern Promise for 2011

Max Bowie, Inside Market Data

It looks like the Inside Market Data and Inside Reference Data teams are going to be seeing more of Asia than ever before this year. In the Chinese zodiac, 2011 is the year of the rabbit, and our events in the region seem to have been breeding like bunnies.

In April, we tour Asia-Pacific, holding joint local market events with industry association FISD in Sydney, Tokyo and Singapore, and staging our own Tokyo Financial Information Summit on April 13. We return to the region with FISD in November, when we hold our annual Asia-Pacific Financial Information Conference in Hong Kong. And in the meantime, our colleagues at WatersTechnology are planning a new event for July, the Asia-Pacific Trading Architecture Summit.

The reason is that—despite the New Zealand Exchange’s decision to close its Australian AXE ECN last week—Asia is still on a hot streak. In the last week alone, SmartTrade Technologies announced that Daiwa Capital Markets is using its liquidity management and market data integration tools to support Asian equities trading, while China’s Guosen Securities is embedding Kx Systems’ kdb+ tick database into its algorithmic trading system, and Thomson Reuters launched a low-latency consolidated feed of data from the Tokyo Stock Exchange, SBI Japannext, Chi-X Japan,, and the Osaka Securities Exchange, via its Elektron infrastructure.

In addition to these fragmented markets, one of the challenges to greater integration of markets across Asia-Pacific is the absence of a common currency or regulatory regime, such as those that exist in the US and Europe. However—aside from pan-Asian mergers such as the tie-up between the Singapore Exchange and Australian Securities Exchange—there are now calls for broader integration between markets. In its December Asia Economic Monitor, the Hong Kong-based Asian Development Bank called for more cooperation between East Asian governments and monetary authorities around exchange rates to promote trade within the region and inward investment, to convert Asia’s robust emergence from the global downturn into sustained growth.

But the lack of regional cooperation so far isn’t hindering other growth in Asia. For example, Chinese data vendor Shanghai Great Wisdom Company last week issued an IPO prospectus in preparation for a public listing on the Shanghai Stock Exchange. The vendor will use the money raised from the IPO to upgrade its existing data products, develop new products and drive further growth in its home market of Greater China. In addition, the funds could be used to deliver non-organic growth at SGWC, which sources say—having already acquired Hong Kong-based AA Stocks last year—is rumored to be eyeing other deals.

After a few lean years in the private equity markets, companies elsewhere are also now finding it easier to raise new funds—if, in some cases, by unorthodox means. Austin, TX-based systems monitoring and timekeeping technology vendor FSMLabs has raised additional finances to fund an expansion of its engineering team by selling the intellectual property contained in four of the vendor’s patents. The vendor won’t reveal the buyer or the amount raised, but the deal allows FSMLabs to continue using the patented technology in its own processes without royalties.

FSMLabs is focusing on its monitoring tools because these are likely to increasingly be in demand as it becomes ever-harder for firms to gain latency advantages, and accurate time monitoring becomes even more critical. So between latency and Asia’s continuing rise, perhaps these are appropriate themes for the year of the hare.

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