The other area of interest in the same presentation was the introduction of circuit breakers, which are a contentious point with various markets in the region introducing different checks. Carried over from an earlier panel on where responsibility for trading errors sits, the exchange is looking at circuit breakers, but it would not be drawn on their precise nature. The debate is broadly around two areas; what should sit at the market level, and what should sit at the instrument level. In terms of specifics these boil down into issues of whether the bands should be dynamic or static, what instruments should be included in their calculation, and what should happen when the bands are triggered. There are many questions around circuit breakers, but again the exchange will consult in 2014.
The second panel of the day looked at the changing nature of electronic and algorithmic trading in the region. One key development is around how the SFC’s algo regulations have changed electronic markets and technology since their introduction on January 1st. When the point was put to the panel on whether the regulations have stifled innovation, the general consensus appeared to be that the rules were too loose before, and that fewer and simpler algos might actually be a good thing on the market. The main takeaway was that technology is there to make trading better, safer, and more reliable for everyone, and regulation can back up that role.
The day was attended by over 400 market participants and combined the best new content from the exchange with a number of great keynotes and panel discussions.
HKEx Ecosystem Forum: Technology And Market Integrity
