ASX reveals $50m trading platform overhaul

The Australian Stock Exchange has outlined a four-year, $50 million path to entirely new trading and post-trade platforms in an effort to make the exchange more flexible, cost effective and quicker to market.

The mammoth effort will kick off with the replacement of the ASX's derivatives and equities trading platforms and risk management and market monitoring systems. This 'phase one' is expected to take up to two years.

The project will consolidate platforms and replace legacy systems with "contemporary global solutions". 

The ASX has chosen Swedish firm Cinnober Financial Technology as its provider for the new derivatives and equities platforms, replacing the eight-year old ASX Trade24 proprietary derivatives system and the NASDAQ OMX’s Genium INET-based equities platform. 

US-based business intelligence and infrastructure firm Tibco has been tasked with providing new middleware for the market monitoring system. The ASX is also using copy data management provider Actifio to eliminate hundreds of terabytes worth of copy data in order to get down to a single copy of each applications' data.

The ASX is yet to select a technology partner for its new risk management system - which includes the central margining engine supporting the ASX's two clearing houses - but expects to do so in the coming weeks.

This first phase is expected to cost $35 million over the two years.

Once the first phase is complete, the ASX will turn its attention to post-trade services, such as cash market clearing and central securities depository services. Design scoping and vendor selection for phase two will start next year. 

"The program will be phased and managed very tightly so that our customers can manage the implementation at their end," ASX CEO Elmer Funke Kupper said in a statement.

"The new infrastructure will also reduce the internal costs for ASX clients to connect to the exchange and improve time to market for new products."

Towards the end of the year, the exchange will also open a 24-hour customer support hub in its $36 million Australian Liquidity Centre high-speed data centre in Gore Hill.

The customer support centre will combine the ASX's operations, market surveillance and technology teams in order to deliver improved services and ensure "Australia's markets operate to the highest standards".

The ASX has forecast a one-off restructuring charge of $6.5 million for the second half of the year as it invests in the skills base required to deliver on the technology transformation.