Since its launch on July 20, the Singapore Exchange’s (SGX) FTSE Taiwan index futures have outpaced the Hong Kong Exchange’s (HKEX), points out CGS-CIMB Research.
For one, SGX’s FTSE Taiwan index futures recorded volumes of 82,000 and 352,000 transactions in July and August, respectively
By comparison, HKEX’s MSCI Taiwan Index futures registered volumes of 4,700 and 7,500 transactions in July and August, respectively.
Open interest for SGX’s FTSE Taiwan index futures is also higher at 6,500 as at end-Aug 20, compared to HKEX’s MSCI Taiwan futures’ 1,500, notes the brokerage.
Moreover, SGX’s client participation in Aug grew more than 50% to over 90 trading entities, it adds.
On May 27, SGX announced that all its non-Singapore MSCI products – including the MSCI Taiwan Index futures – will expire from February 2021 onwards.
This was revealed on the same day that HKEX announced it will offer 37 new products – including the MSCI Taiwan Index futures – after signing an agreement with MSCI.
SGX and HKEX are widely seen to be close rivals in Asia.
“The introduction of these two new contracts has not resulted in a steep drop in SGX’s existing MSCI Taiwan index volume,” CGS-CIMB analyst Ngoh Yi Sin writes in a note dated Sept 14.
CGS-CIMB has maintained its “add” rating for the stock with an unchanged target price of $9.00.
As at 2.47 pm today, SGX was up 8 cents or 0.9% at $8.60 with 1.5 million shares changed hands.
