Australian Securities Exchange

The Australian Securities Exchange (ASX) is the primary stock exchange in Australia. The ASX began as separate state-based exchanges established as early as 1861. Today trading is all-electronic and the exchange is a public company, listed on the exchange itself. The Australian Securities Exchange as it is now known resulted from the merger of theAustralian Stock Exchange and the Sydney Futures Exchange in December 2006. The biggest stocks traded on the ASX, in terms of their market capitalization, include BHP Billiton, Commonwealth Bank of Australia, Telstra Corporation, Rio Tinto, National Australia Bank and Australia and New Zealand Banking Group. As at 31-Dec-2006 the three largest sectors by market cap were financial services (34%), commodities (20%) and listed property trusts (10%).The major market index is the S&P/ASX 200, an index made up of the top 200 shares in the ASX. This supplanted the previously significant All Ordinaries index, which still runs parallel to the S&P ASX 200. Both are commonly quoted together. Other indices for the bigger stocks are the S&P/ASX 100 and S&P/ASX 50. The ASX is a public company, and its own shares are traded on the ASX. However, the corporation's charter restricts maximum individual holdings to a small fraction of the company. While the ASX regulates other listed companies listed on the ASX, it cannot regulate itself, and is regulated by the Australian Securities and Investments Commission (ASIC). The current managing director Robert Elstone was appointed in July 2006. Prior to the merger of ASX with the Sydney Futures Exchange (SFE), Robert Elstone was the CEO of the SFE. ASX has a pre-market session from 07:00am to 10:00am AEST and a normal trading session from 10:00am to 04:00pm AEST. The market opens alphabetically in single price auctions, phased over the first ten minutes, with a small random time built in to prevent exact prediction of the first trades. There is also a single-price auction between 4:10pm and 4:12pm to set the daily closing prices. ASX CFDS are a new form of contract for difference that will be traded through an exchange based mechanism. Current CFD providers focus on either the direct market access or market maker models. This new development is set to be launched in November 2007 on the ASX and will be offered by Australia's leading online brokers and over-the-counter (OTC) CFD providers including First Prudential Markets (FPM) and Commsec. ASX CFDs will enjoy the traditional benefits of leverage enjoyed by over the counter contracts for difference but with reduced transaction costs from the central counter clearing model negating the financing charges traditionally imposed by third party cfd providers. The interest rate market on the ASX is the set of corporate bonds, floating rate notes, and bond-like preference shares listed on the exchange. Those securities are all traded and settled the same as ordinary shares, but the ASX provides information such as their maturity, effective interest rate, etc, to aid comparison. The ASX trades futures over the ASX 50, ASX 200 and ASX property indexes, and over grain, electricity and wool. Options over grain futures are also traded. Futures are traded on DTP, the Derivatives Trading Platform (also known as CLICK).