Singapore Exchange (SGX) is the Asian Gateway, connecting global capital to Asian growth and Asian investors to global opportunities.
Global customers coming to SGX will find a world-class venue for debt and equity fund-raising via listings, trading, clearing, and settlement of equities, financial derivatives and commodities, and depository services. In short, SGX provides market participants with diversified products and services across major asset classes and risk management tools to navigate today’s fast changing market and regulatory conditions.
Access to Asian Derivatives in One Place
SGX provides trading and clearing services for a wide range of derivatives including Equity Index, Interest Rates, Foreign Exchange, Commodities as well as OTC Financial Derivatives, such as Interest Rate Swaps.
The wide product range is complemented by additional services offered to members, such as Market Data services, Market Access Services, Customer Collateral Protection, OTC Financials Trade Compression and many more.
Best-in-class Regulatory and Risk Management Standards
SGX’s regulatory and risk management framework is of the highest standard.
- SGX-DC maintains a minimum of 25% contribution to the Clearing Fund, significantly higher than most CCPs
- Under the proposed Basel III framework, Members continue to derive capital efficiencies from clearing exchange traded and OTC trades with SGX
Regulated by the Monetary Authority of Singapore (MAS) SGX is also the first Asian CCP authorized as a Derivatives Clearing Organization (DCO) by the US Commodity Futures Trading Commission (CFTC).
In addition SGX has applied for recognition as third country CCP under the European Market Infrastructure Regulation so as to continue providing clearing services to EU customers. Processes and systems have been independently assessed by IMF and found to be highly compliant with CPSS-IOSCO PFMI standards.
T, T+1 Trading Sessions and Clearing Cycles for ETD and OTC Commodities allows trading from Asian opening till European close.
SGX offers several possibilities to register block trades and bilaterally agreed trades. Members are able to use the Trade Registration System (TRS) GUI and API as well as the electronically Negotiated Large Trades (eNLT) platform GUI and API. Furthermore, members have the possibility to use the Trade Report API for trade registration.
Mutual Offset System (MOS)
SGX-DC and CME have a long standing mutual offset arrangement since 1984 that allows market participants to initiate positions in one exchange for allocation to the other on a real-time basis
Currently the following SGX-DT products are eligible for mutual offset with CME:
- Eurodollar Futures (ED)
- Euroyen (TIBOR) Futures (EY)
- Nikkei 225 Index Futures (NK)
- USD Nikkei 225 Index Futures (NU)
- CNX Nifty Index Futures (IN)
Pre-Trade Risk Control
SGX allows Clearing Members to set certain limits in order to control their client business. Clearing Members have the possibility to set order size limits by products for their clients as well as credit limits, so that e.g. positive delta orders will be rejected while negative delta orders will be accepted.
Trade and position management are processed on a real-time basis. Trade and position management such as rectifications, give-ups, exercises, position close-outs and reinstatements and spread position reporting can be performed by Clearing Members real-time.
SGX-DC has in place an overarching default management framework and detailed procedures, which are continuously refined and tested for relevance.
No losses were incurred by SGX during the orderly wind down of Lehman and MF Global due to the default of their parent companies. Clearing Funds were not used in any of the cases and excess margin was returned to identified owners.
- Cash collateral in the following currencies: SGD, USD, JPY, EUR
- Government securities from Singapore, US, Japan, Germany and France
Learn about SGX Derivatives Clearing
SGX provides clearing services for Interest Rate Swaps, Non-Deliverable Interest Rate Swaps and Non-Deliverable FX Forwards. Additional services include Enhanced Customer Collateral Protecting (ECCP), triReduce trade compression, a Margin Calculator and Backloading.
Learn about SGX OTC Financials Clearing
Margin at minimum 99% confidence level
- At product level for Exchange traded and centrally cleared commodities (SPAN)
- At product portfolio level for OTC Financials (HSVaR)
- Daily back-testing of margin models
- Concentration and credit risk add-on are imposed when required
Gross margin requirements
- Gross aggregation of margins at Customer and House account levels
Robust Margin offset
- Offsets within each asset class if products have underlying economic relationship
Learn about SGX Risk Management