JSE Improves Trading Speed

VENTURES AFRICA- As speed becomes increasingly relevant in the exchange industry; Africa’s largest bourse, Johannesburg Stock Exchange (JSE), has upgraded its trading platform yesterday by launching the “Millennium Exchange” equity trading system.

The Millennium Exchange is expected to attract more business from hedge funds and avoid the system glitches that have undermined the reputation of the trading platform. Apart from this, the new trading platform will be used to attract investors who rely on increasingly sophisticated automated trading strategies.


The new platform which is also used by the London Stock Exchange (LSE) for its cash market will reduce glitches and speed up trading by enabling traders execute transactions at nearly 400 times the previous speed.


According to the Director of the JSE, Leanne Parsons, the adoption of Millennium Exchange could have a significant impact on trading volumes by attracting a greater share of high frequency trading when collocation and the appropriate billing models are in place.


“There is anecdotal evidence to suggest that when exchanges increase their trading speeds they also boost levels of trading. This is important in order to deepen a market,” Parsons affirmed.


As part of its upgrading, JSE will move its equity trading systems engine from London to Johannesburg to mininmise technical glitches. This will put an end to a decade of having the trading engine in London.


The local bourse stated that the relocation would make it less dependent on the transatlantic cable connecting it to the London Stock Exchange and minimise outages.


“By moving the engine to Johannesburg, we eliminate this problem and are able to offer our clients improved service availability and stability,” the bourse said.


“The handful of incidents that we have had requiring the equity market to be halted, have been related to our international connectivity links. Clearly these have had reputational impacts. By moving the engine to Johannesburg, we eliminate this problem and are able to offer our clients improved service availability and stability,” parson said.


The JSE has faced connection problems in the past which has caused embarrassing glitches that sometimes stop trading activities for hours between the Johannesburg and London office.


The seamless migration from the previous TradElect platform follows Borsa Italiana’s identical switch last week.


JSE TradElect was licensed from the London Stock Exchange and maintained and operated by the London bourse.


However, the new equity trading platform was improved by MillenniumIT, a Sri Lanka based technology group with over a decade of experience in building technology solutions for the capital markets. The company under its flagship product, Millennium Exchange, is known for its speed and scalability.


Meanwhile, data from the World Federation of Exchanges revealed that as at May, the JSE has a market value of $775 billion leaving it at par with the Spanish bourse.


The value of equities traded stands at $147 billion for the year to May, according to the data, substantially behind European exchanges, as well as emerging markets such as Turkey, Reuters reported.