Hong Kong Exchanges and Clearing Limited (HKEX) has extended its relationship with Nasdaq, appointing it to upgrade the infrastructure of its derivatives market.
Nasdaq will implement upgrades to HKEX’s trading, clearing and risk management technologies, providing its Nasdaq Multi Matching Engine, plus its multi-asset derivatives clearing engine Nasdaq Clearing Engine, and its risk management solution Nasdaq Real-Time Risk.
The new solutions are intended to improve the performance, flexibility and resilience of trading and clearing, and to help central counterparties and exchanges to manage new risks around financial derivatives.
They will be based on the Nasdaq Financial Framework, an architecture allowing for integrated applications across the trade lifecycle, using a single operational hub.
The clearing solution will be integrated with the matching, making for a more harmonised back office, while the whole system is built to accommodate continuous change. Other third-party trading and post-trade systems should be able to integrate easily, making for a reduced total cost of ownership.
Richard Leung, co-head of IT at HKEX, commented: “We have been able to provide superior capability and very reliable market infrastructure, high priorities at HKEX, with the Nasdaq technology we use in our derivatives market.”
He added: “We look forward to completing our upgrade smoothly and receiving continued high-quality technical support from Nasdaq.”
HKEX and Nasdaq have also agreed to extend their existing relationship for at least another five years. The institutions have worked together as partners since 1994.
Lars Ottersgård, executive vice president and head of market technology at Nasdaq, said: "Nasdaq is proud of the technology partnership that has existed between our respective organisations for nearly 25 years."
He added: “HKEX is one of the global capital markets' true innovators who are committed to the continuous introduction of new technologies to bolster and strengthen the product and services offerings for their clients and partners, along with a rigorous focus on shaping the future of our industry."
The technology upgrade is expected to be complete in late 2018.
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