Bangkok--29 Apr--SET
Thailand Futures Exchange PCL (TFEX) disclosed that during its first three years of operations, average daily trading volume grew over six times, and the number of accounts opened more than tripled, to 20,000 accounts. TFEX will launch new products and focus on increasing the liquidity of existing products, together with creating more product understanding to continually expand its investor base.
TFEX marks its third anniversary of operations, TFEX Chairman Pakorn Malakul Na Ayudhya revealed. Whereas only 161 contracts were traded on the first day of operations in 2006, in 2008, its daily average trading volume was 8,837 contracts, worth THB3,810.49 million, with an open interest of 22,747 contracts. Today, TFEX is 45th in the global derivatives market, determined by the total trading volume.
TFEX’s growth resulted from its major product, SET50 Index Futures, and its dedication in research to develop new products respond to investors’ needs in terms of risk management, investment alternatives and opportunities to make profits. Studies and the experience of institutional investors show that SET50 Index Futures can be effectively used for risk protection for those holding big-cap stocks, with lower expenses and costs. Besides, the study found that SET50 Index Futures can be used to indicate SET50 Index price.
TFEX’s operation systems and trading rules are in accordance with the international standards of other derivatives markets, helping foreign investors conduct transactions without obstacles, and as conveniently as local investors. TFEX accepts diversified members, which will help develop the market. Four gold shops joined to trade gold futures from March 2009, making a total of 40 members.
“The three years’ growth resulted from the hard work of all parties in developing the Thai capital market to have effective risk management tools and meet international standards. The Ministry of Finance, Securities and Exchange Commission, SET, Thai Clearing House Co., Ltd., TFEX, TFEX members, and investors were the important sectors who help support TFEX’s successful operation to this point” Mr. Pakorn noted.
“As TFEX enters its fourth year, it will develop its new products that are vital to the country’s economy and finance, including stock futures with interest rates or exchange rates as the underlying asset(s). In addition, TFEX will focus on creating product understanding to help investors in using TFEX products to manage their investments, including simulation, seminars by specialists with extensive trading experience, or increasing liquidity on existing products by revising rules to encourage market makers to help create liquidity. These factors should help support TFEX’s sustainable growth,” Mr. Pakorn said.
As of March 31, 2009, there were 19,263 derivative trading accounts, a tripling from the 4,426 accounts of 2006; a daily average trading volume of 8,621 contracts, six times up from the from end-2006’s volume of 1,204 contracts. As of end-March 2009, open interest was at 27,744 contracts, almost three times up from end-2006’s volume of 7,601 contracts.
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