ASX and Chi-X support ASIC reduction order
The Australian Securities Exchange (ASX) and Chi-X have come out in support of the Australian Securities and Investments Commission (ASIC) directive to markets operators, limiting the number of trades they can execute until further notice.
This would require those market operators to reduce their number of trades by up to 25% from the levels last Friday, 13 March.
Dominic Stevens, ASX managing director and chief executive, said recent trading volumes on the ASX and Chi-X have been unprecedented, creating operational challenges for the industry.
“We recognise today’s action by ASIC is only the first step, and that more consideration needs to be given to a permanent solution,” Stevens said.
“The industry cannot provide unlimited capacity at short notice. Regulators, exchanges, participants and investors will need to come to a decision on what they want for the future.”
Stevens said the ASX would continue to collaborate with the industry and had also worked closely with other market operators and participants to help with their operational processes.
“ASX shares the regulator’s determination to maintain confidence in the integrity of Australia’s financial markets and we will continue to cooperate with ASIC, other market operators and market participants.”
Chi-X Australia said they would closely monitor the development and impact of COVID-19 on Australia’s financial markets and noted the exceptional recent volumes which culminated in the record trading levels on Friday, 13 March.
It was normally supportive of markets operating in an orderly and transparent manner without intervention, however, they supported prescriptive Australian Securities and Investments Commission (ASIC) measures announced.
“Chi-X is of the view that the measures are, for the time being, an appropriate response to the recent exceptional volumes and the potential issues they may raise across the Australian market,” a statement from the company said.
“It is important for all stakeholders to ensure the ongoing fair and orderly operation of Australia’s financial markets and Chi-X is grateful to ASIC and those participants involved for the assistance they have provided in achieving this goal.”
Recommended for you
Perpetual has seen AUM rise 6 per cent in the last quarter but the departure of a longstanding JOHCM fund manager led to outflows of $2.2 billion from his strategy.
In the latest Meet the Manager profile, Money Management speaks with Michael Skinner, founder and managing director at Blackwattle Investment Partners.
Global fixed income fund Bentham Global Opportunities has been added to several major platforms, enabling it to be accessed more easily by financial advisers.
Following yesterday’s news about First Sentier Investors closing four investment teams, a second global asset manager has announced it is closing its only dedicated Australian fund.
