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HKEx Enhances its Securities Market Trading System

Market Operations
29 Jan 2007

Hong Kong Exchanges and Clearing Limited (HKEx) has enhanced its securities market trading system, AMS/3 (Third Generation of the Automatic Order Matching and Execution System) following the successful completion of weekend market rehearsals.  The changes will improve Exchange Participants’ efficiency and the order input capacity in AMS/3.

The enhancements comprised:

  • Increasing the maximum number of outstanding orders per price queue from 10,000 in the Pre-opening Session (9:30 – 10 am) and 8,000 in the trading sessions (10 am – 4 pm) to 20,000 in all sessions (see table);

  • Removing the restriction on outstanding orders per broker ID, which had been 4,000 orders (see table); and

  • Further increasing AMS/3’s market data broadcast rate to cater for the continuing growth in trading activity.

Maximum outstanding orders   Previous New
- Per price queue Pre-Opening Session
Trading sessions
10,000
8,000
20,000
20,000
- Per broker ID   4,000 None

“These changes demonstrate our commitment to ensuring our major market systems are robust and reliable, and that our trading facilities continue to meet the needs of our customers,” said HKEx Deputy Chief Operating Officer Gerald Greiner, who is also Head of the Exchange Division.   

During the rehearsals, a volume test was also conducted to verify that AMS/3 has the capacity to handle further rises in order and trade volume from current levels.

“The volume test verified that AMS/3 is capable of handling 1.5 million trades in a trading day within the benchmark response time*,” said Alfred Wong, HKEx’s Chief Technology Officer and Head of Information Technology.

“The rehearsal also provided an opportunity for Exchange Participants with Broker Supplied System (BSS)# and information vendors to verify the capacity and performance of their systems and associated infrastructure under high market activity and ascertain their readiness for further growth in trading volume,” Mr Wong added.  “The readiness of the intermediaries’ systems is important because their performance will directly affect their services to investors.”   

A large majority of Exchange Participants using BSS and all information vendors maintaining direct connections with HKEx participated in the weekend market rehearsals. 

“Exchange Participants have demonstrated a high degree of professionalism and commitment in the market rehearsals.  HKEx thanks them for their efforts and we look forward to their continued support," Mr Greiner said.

* The benchmark response time is that orders entered into AMS/3 will be executed within a mean of one second.

# Broker Supplied Systems, or BSS, which are set up and used by Exchange Participants, connect to AMS/3 through an open interface provided by HKEx and provide order management and other electronic trading facilities.

Updated 29 Jan 2007