Singapore Exchange To Build Market Portals In Chicago, London

Singapore Exchange (S68.SG) said Tuesday that it plans to lure far-flung computer driven traders to its markets, setting up local connection points for firms in Chicago and London.

The trading hubs will enable electronic trading firms to access Singapore-based markets through local data centers and are the first in a series of such portals that the exchange operator is considering, according to its chief executives.

"We want to see some volume first," said Magnus Bocker, CEO of Singapore Exchange, speaking at an event on the sidelines of the Futures Industry Association conference in Boca Raton.

A well-rounded offering of stock listings, derivatives markets and trade-processing services has elevated the SGX into the top tier of exchange companies globally. It has sought to position itself as a gateway to Asian markets, leveraging Singapore's more-flexible regulatory regime and the nation's position as a regional center for risk management.

About 85% of SGX's trading volumes come from outside Singapore's borders, according to Rama Pillai, deputy head of sales and clients for the company. The figure is roughly split between Asia and the western hemisphere, with the U.S., UK and Japan representing the most business.

The new electronic trading portals, seen opening in April, are aimed at foreign-based firms interested in trading SGX products but wary of the cost of forging their own high-speed connections. They come as part of a $250 million technology investment pushed by SGX, which also includes a new data center and faster trading engine.

Additional trading SGX trading hubs could be built in New York, Tokyo, Hong Kong and Frankfurt, should the initial efforts prove successful, Bocker said.

The SGX effort mirrors similar campaigns by U.S.-based rivals like CME Group Inc. (CME) and NYSE Euronext (NYX), which have built their own market portals designed to funnel trading from overseas.

-By Jacob Bunge, Dow Jones Newswires; 312 750 4117; [e-mail]