This Week: HKEx's new derivatives platform; GoldenSource; Quonian-SimCorp, and more

HKEx outlines Orion derivatives platform

Hong Kong Exchanges and Clearing has begun development of a new derivatives trading system, dubbed Orion Derivatives Platform, as part of a broader program to refresh HKEx’s in-house technology capabilities and position it as a more competitive global exchange.

Orion, which the exchange expects to go live in 2028 in a phased migration, will replace the exchange’s current derivatives platform, the Hong Kong Automatic Trading System. HKats was introduced in 2013 and upgraded in 2019 to run on Nasdaq’s Genium Inet platform, which powers Nasdaq’s Nordic equity derivatives, fixed income derivatives, and commodities marketplaces. Market participants currently access HKats via an OMnet API or the HKats Online web-based front-end, over the SDNet (Securities and Derivatives Network) optical Ethernet network.

Officials say Orion will be built on a modular architecture, making it easier for the exchange to introduce new products, enhance market microstructure, and add new capabilities. For example, “enhanced trading and clearing capabilities” that would be possible on Orion include “near 24-hour” trading and additional order types. Also, by introducing its Value-at-Risk model—which was rolled out on its cash equities market in 2022—will help improve risk management while also reducing the cost of trading.

Announcing the new platform, HKEx CEO Bonnie Chan noted that derivatives trading is one of the fastest-growing segments of HKEx’s business, with record-breaking volumes for the past two years, adding that she believes that “developing an in-house platform that is adaptable, efficient, and scalable would give us a unique competitive advantage in the global derivatives space.”

Separately, Chan explained HKEx’s decision to move ahead with the development.

“We are taking a significant step to owning our own our digital destiny and making long-term investments in our in-house systems—developing custom-designed solutions, reducing time-to-market when we innovate for the benefit of our clients, and maintaining our trading, clearing, and risk management in real time,” she said. “ODP is a great example: as a self-developed modular-architecture model, it enables us to provide robust, yet flexible and efficient solutions that differentiate us and make us more competitive vis-a-vis our peers. ODP is a multi-year project that underscores our commitment to the diversification of our business, and to Hong Kong’s markets.”

A longer-term component of the exchange’s technology renewal will be taking “a holistic look” at its clearing infrastructure, which includes the CCASS (Central Clearing and Settlement System) platform for securities clearing and DCASS (Derivatives Clearing and Settlement System), Chan said.

GoldenSource enters the Dragon

Vietnamese asset manager Dragon Capital Group has deployed New York-based data management solutions vendor GoldenSource’s Data Warehouse in Amazon Web Services’ cloud, following the vendor launching its data management infrastructure solutions on AWS Marketplace to help its customers streamline their data management processes and accelerate their cloud migrations.

Dragon officials say using GoldenSource’s offering via AWS will enable it to more easily leverage analytics to gain insights that support its investment strategies and risk activities, using a cloud platform that is cost-effective, flexible, and scalable enough to support the asset manager as it expands.

QuantHouse adds BMLL historical data

Low-latency data provider QuantHouse, a division of trading technology and data provider Iress, is to carry BMLL’s full-depth historical order book data to help buy-side clients better understand market behavior and test trading strategies.

The vendors have already completed mapping the data symbologies of QuantHouse’s real-time data and BMLL’s historical data, which are now harmonized and use the same format. Officials say the move will help asset managers and hedge funds more quickly move from testing strategies to putting them into production.

Clearstream to broaden asset coverage via DVS stake

Deutsche Börse’s Clearstream post-trade services business has announced plans to invest in Digital Vault Services, a provider of issuance and safekeeping services for digital bank guarantees and sureties in Europe.

The investment will initially allow DVS to enhance and broaden its infrastructure offering form financial firms and corporate clients, and longer-term to integrate its Guarantee Vault with Clearstream’s D7 post-trade platform for digital assets, enabling D7 t expand its asset coverage beyond securities. The parties have not disclosed the size of the investment, but say it will represent a minority stake in DVS, and is expected to close in the second half of this year.

Sumitomo Mitsui AM taps DTCC for T+1 compliance

Japanese asset manager Sumitomo Mitsui Trust Asset Management has begun using DTCC’s suite of Institutional Trade Processing (ITP) services to accelerate its trade processing capabilities ahead of North America’s move to T+1 settlement at the end of May.

The firm is using DTCC’s Central Trade Matching (CTM) platform, including its Match to Instruct (M2i) workflow, and its TradeSuite ID, Alert, and Settlement Instructions Manager to fully automate its post-trade processing and achieve same-day affirmation for cross-border trades in Asia-Pacific.

Quoniam enlists SimCorp for middle-office ops platform

Frankfurt-based Quoniam Asset Management is outsourcing its middle-office operations technology to SimCorp, which will deliver a new solution that combines the quant firm’s proprietary research and portfolio construction capabilities with SimCorp’s core enterprise Software-as-a-Service platform, and a suite of technology services for data management and investment operations.

Under the deal, SimCorp will be responsible for data management of market and reference data for Quoniam’s investment operations, as well as for managing the firm’s post-trade operations and operational and regulatory reporting.

Athena, Bton ally for AI-enabled OMS, PMS

Order management and portfolio management system provider Athena has integrated Bton Financial’s AI Trader Copilot solution into its OMS and PMS to streamline trading decisions for asset managers, hedge funds, and banks, especially around equities and ETF trades.

The integration allows traders to select orders in their blotter and specify a range of parameters, including size, instrument, algorithms, and timeframes with a single mouse click, potentially opening the vendor’s solutions to a broader array of buy-side clients of different sizes.

ExtractAlpha debuts Nikkei-based news sentiment signal for Japan

Alternative data analytics platform ExtractAlpha has launched a new signal, the Japan News Signal, developed for those trading Japanese markets, and based on Nikkei’s Flash News dataset.

The Japan News Signal uses machine-learning techniques, including a sentiment model constructed by using Japanese BERT, a machine-learning tool that uses embedded text vectors to predict long-term results, allowing the signal to identify “more persistent and latent predictive features” of the news beyond merely positive or negative sentiment, which will enable users to identify greater alpha at longer time horizons.

ESG non-profit Sustainable Trading grows membership

Sustainable Trading, a non-profit organization seeking to help firms in the capital markets to implement ESG practices, has announced that ING Bank, market maker Optiver, and hardware ticker plant and data vendor Exegy have become new members of its movement.

The organization will soon launch an industry survey to gain insights from employees of companies in the global trading community, and provide market participants with guidance on how to better support their workforces.

Nord vLEI gets nod to issue verifiable LEIs in Europe

Sweden’s Nord vLEI, a subsidiary of Scandinavian LEI issuer NordLEI, has been appointed by the Global Legal Entity Identifier Foundation (Gleif) as the first European qualified issuer of verifiable Legal Entity Identifiers. The vLEI is a way to authenticate and verify legal entities across different industries, by wrapping LEIs in digital credentials that can be verified—for example, for digital signing purposes, or for delegating signing authority to verified individuals.