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ASX at a glance

ASX Limited (ASX) is a multi-asset class, vertically integrated, top-10 listed exchange group operating the largest interest rate derivatives market in Asia.

What we do

ASX plays an important role in Australia's financial markets as a trusted, central and independent party. ASX’s activities and revenues are grouped into four key businesses.

Business unit

% of Group revenue*

Business model and operating environment

Listings and Issuer Services

26

ASX, through its infrastructure and operating rules, provides a facility for entities to list, raise capital and have their securities publicly traded. ASX provides a range of services to issuers of capital, including the generation of security holding statements and other shareholder and sub-register services. ASX also lists debt securities (including bonds) and exchange-traded investment products.

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Derivatives and OTC Markets

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ASX offers exchange-traded derivatives, including the trading and clearing of futures and options on futures on interest rate, equity index, agricultural and energy contracts, as well as exchange-traded options over individual securities.

Through the licensed clearing and settlement facility, ASX Clear (Futures), ASX provides central counterparty clearing (CCP) of exchange-traded derivatives as well as clearing of over-the-counter (OTC) derivatives. ASX Clear (Futures) provides risk management services supported by clearing participant collateral, and funds provided by both ASX and participants, which are available in the event that participants fail to meet their obligations.

Austraclear provides settlement, depository and registry services. Austraclear settles transactions in debt securities and cash on a real-time gross settlement (RTGS) basis. Austraclear also provides registry services, facilitating the issuance and registration of debt security, coupon and redemption payments. 

The ASX Collateral service supports the utilisation of debt securities held in Austraclear as collateral to meet obligations to other cusotmers or to ASX's clearing subsidiaries.

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Trading and Information and Technical Services

26

Trading Services comprises the trading of securities in the cash market as well as the information and technical services offered by ASX. The cash market comprises the trading of equities, warrants, exchange-traded funds and listed debt securities.

Information services includes the provision of real-time market data for the cash and derivative markets, provision of indices, company news, and index and other reference data.

Technical services consists of five main categories of services to facilitate market connectivity and access to ASX and third-party services by customers. These are:

  • ASX distribution platform, hosting of customer infrastructure within the ASX Australian Liquidity Centre (ALC) and ASX Net site management
  • The facilitation of connectivity with the ALC and ASX Net
  • ASX service access including access and sessions for market data products and clearing and settlement systems
  • Market access to trading sessions, liquidity cross-connects and order entry, as well as trade gateways
  • DataSphere, ASX's data analytics capability, which offers big data as a service.

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Equity Post-Trade Services

12

ASX's cash market clearing and settlement infrastructure provides risk management services through its central counterparty clearing (CCP) and delivery versus payment settlement of cash market trades.

ASX's post-trade operations are backed by significant Australian-based capital and collateral, and are overseen by Australia's regulators. Through a process known as novation, the CCP assumes the credit risk of all trades centrally cleared and thus facilitiates an efficient and orderly clearing and settlement function for the market.

Cash market clearing

The CCP supports these risk management activities with collateral lodged by clearing participants and ASX funds in the clearing guarantee fund. These collateral and guarantee fund resources can be called upon in the event a clearing participant does not meet its obligation to finalise a trade that has been novated to the CCP. 

Cash market settlement

Cash market settlement is conducted through the Clearing House Electronic Sub-register System (CHESS). This system registers the title (ownership) of shares. ASX’s model for cash market settlement maximises efficiency through the netting of settlement obligations in each individual security and the netting of all payment obligations, while minimising the risk of settlement failure.

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*as at 30 June 2019