Hong Kong Exchanges & Clearing Ltd. · HKEX:388
Hong Kong Exchanges & Clearing — Conference Presentation (October 2023)
20 slides from Hong Kong Exchanges & Clearing's conference presentation, October 2023
Slide 1: Self-Match Prevention in Securities and Derivatives Market – Webinar
Self-Match Prevention in Securities and Derivatives Market – Webinar Oct 2023
Slide 2: Agenda
Agenda 01 | Overview of SMP Model Design 02 | SMP in Securities and Derivatives Market 03 | FAQs on SMP ID Registration and SMP Service Usage 04 | System Requirements and Timeline
Slide 3: Overview of SMP Model Design
01 Overview of SMP Model Design
Slide 4: Overview of SMP Model Design – Introduction of SMP in Securities Market and Enhancement in Derivatives Market
Overview of SMP Model Design – Introduction of SMP in Securities Market and Enhancement in Derivatives Market 1 Service Nature Free service* Level of Granularity on Based on SMP ID. Different SMP IDs for securities and derivatives 2 SMP Setting market (Securities: 9 digit; Derivatives: 5 alphanu
Slide 5: SMP in Securities and Derivatives Market
02 SMP in Securities and Derivatives Market
Slide 6: Securities Market – Illustration of Cancellation Method
Securities Market – Illustration of Cancellation Method SMP (Securities Market) Scenario: Investor A possesses a SMP ID (210005012) Investor A’s incoming order No update to the order book (i.e. 3K sell order) is cancelled. Bid Qty Price Ask Qty Bid Qty Price Ask Qty CANCEL AGGRESSIVE 100 1K 100 1K 1
Slide 7: Securities Market – Illustration of SMP Setting (by SMP ID)
Securities Market – Illustration of SMP Setting (by SMP ID) Check SMP ID per order Order with Order with Exchange Participants SMP ID SMP ID 201010094 201010094 EP 1 EP 2 Exchange Participants’ Clients Client A Client B Client B Client C Same SMP ID client SMP ID SMP ID SMP ID SMP ID 210005012 20101
Slide 8: Derivatives Market – Two Types of SMP Models
Derivatives Market – Two Types of SMP Models The newly introduced ID-based model will co-exist with the existing HKATS Username-based model: Existing model Additional new model HKATS Username-based SMP ID-based SMP Service Nature Free service* Continuous Trading Session Applicable Session (day tradi
Slide 9: Derivatives Market – Illustration of Cancellation Method (HKATS Username-Based SMP)
Derivatives Market – Illustration of Cancellation Method (HKATS Username – Based SMP) HKATS Username-based SMP Scenario: EP (e.g. ABC) has enabled HKATS Username-based SMP for Investor A’s HKATS Usernames (ABC1091) Potential Self-Match SMP kicks in Initial Order Book No Self Match Bid Qty Price Ask
Slide 10: Derivatives Market – Illustration of Cancellation Method (ID-Based SMP)
Derivatives Market – Illustration of Cancellation Method (ID - Based SMP) ID-based SMP Scenario: Investor A possesses a SMP ID (5KKKB) Investor A’s incoming order (i.e. 3K sell No update to the order book order) is cancelled. Bid Qty Price Ask Qty Bid Qty Price Ask Qty CANCEL AGGRESSIVE 100 1K 100 1
Slide 11: Derivatives Market – Illustration of SMP Setting
Derivatives Market – Illustration of SMP Setting HKATS Username-based SMP: Check if Exchange orders are from HKATS Username which Participants enabled SMP ID-based SMP: Check SMP ID per order DEF Customer Codes (CUST) ABCAA ABCBB DEF DEFAB (Dedicated CUST (Dedicated CUST (Shared CUST for multiple (H
Slide 12: FAQs on SMP ID Registration and SMP Service Usage
03 FAQs on SMP ID Registration and SMP Service Usage
Slide 13: Registration of a SMP ID
Registration of a SMP ID* A. Only one SMP ID may be registered for use by an EP for its proprietary orders and only one SMP ID may be registered for each client of an EP, except where there are any other independently operated trading unit(s) within the EP or the client, additional SMP IDs may be re
Slide 14: FAQs on the SMP ID application
FAQs on the SMP ID application Q1. What information is required when applying for a SMP ID? A1. Basic information (e.g. Legal entity name) and a description of the business setup (e.g. number of trading desks) of the EP or the client, as the case may be, are expected to be required. In addition, sel
Slide 15: FAQs on the use of the SMP Service
FAQs on the use of the SMP Service Q1. Will the usage of SMP Service be monitored? A1. Yes, the use of the SMP Service will be monitored. EPs are reminded and should also remind its clients that the use of SMP Service for any non-bona fide purpose may be a non-compliance with the terms and condition
Slide 16: SMP ID Registration Workflow
SMP ID Registration Workflow HKEX may contact EPs for more information EPs HKEX Fillable PDF EP(s) submit SMP ID HKEX will review SMP maintenance form and related request and inform sharing consent form to EP(s) of the result through HKEX via ECP ECP reports Reports ECP ECP generates SMP ID reports
Slide 17: System Requirements and Timeline
04 System Requirements and Timeline
Slide 18: Securities Market – System Interface Change
Securities Market – System Interface Change System backward Compatibility • No system change required for EPs not planning to use SMP service ID-based SMP • One new field for OCG-C for using Securities Market SMP service Binary Trading Protocol Description Field Name Required SMP ID N (optional) The
Slide 19: Derivatives Market – System Requirement
Derivatives Market – System Requirement HKATS Username-based SMP • No system change ID-based SMP • Will have system changes 1 Introduction of “SMP Token” 2 Introduction of Optimized Quote MO960 1. In the below listed HKATS Online Windows 2. In the below listed OAPI messages 1) Enter Order 1) Order E
Slide 20: Timeline and Milestone Updates
Timeline and Milestone Updates *Completed* Securities Market Project Introduction Kick-off announcement (e.g., FAQ, project background and technical specification) Briefing Sessions Market Readiness Official SMP Issuance of Tech. Discussion on workflow Market test until mid-Mar Project and technical
Hong Kong Exchanges and Clearing — Conference Presentation (October 2023) on 6ix