Osaka Exchange

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Osaka Exchange
Osaka logo.jpg
Founded 1949
Headquarters Osaka, Japan
Key People Hiromi Yamaji, president and CEO
Products Equities, stock index futures and options and equity options
Website http://www.ose.or.jp/e/


The Osaka Exchange, a division of the Japan Exchange Group, is an electronic exchange that lists index futures, index options, and security options.

Formerly called the Osaka Securities Exchange (OSE), it was merged with the Tokyo Stock Exchange in January 2013 and renamed the Osaka Exchange. The new holding company created by the merger is the Japan Exchange Group.[1] [2] [3]

Osaka Exchange merged its cash-equity trading platforms with the Tokyo Stock Exchange in July 2013, which added 1,100 stocks to the Tokyo Stock Exchange, making it the third biggest bourse by listed companies.[4]

Osaka Exchange serves as the primary listed derivatives market for JPX. In 2015, JPX was ranked 16th in terms of volume, with 361.4 million contracts traded, up 16 percent from 309.7 a year earlier, according the FIA's annual volume report.

History

The origin of securities exchanges in Japan stems from the Edo Period, when the exchange for Rice & Crops was established in Osaka, Japan's economic center. Each prefecture set up its own warehouses in Osaka for storing and shipping their rice to merchants. A number of merchants gradually gathered to create one market, called "Yodoya-Komeichi," the first securities exchange in the nation.

This market was moved to Dojima in 1697, and called "Dojimakomekaisho", meaning a physical market to trade in rice-tickets or physical rice. In 1716, Cho-gomai transactions were introduced, said to be the origin of futures transactions in Japan. They were recognized by the government in 1730.[5]

More formally, Osaka Exchange was created in 1878 as the Osaka Stock Exchange.[6]

The OSE demutualized in 2001 and listed on its own board in 2004.

Products

Osaka Exchange offers a number of stock index as well as government bond futures and options contracts traded on Nasdaq OMX's Click XT trading system including:

For more on Osaka and JPX derivatives products, visit HERE.


Contract Volume

Year Total Annual Volume Percent Change World Ranking
2012 205,130,168 (+) 5.6% 18
2011 194,176,001 (-) 1.1% 18
2010 196,350,279 (+) 18.2% 15
2009 166,085,409 -- --

Key Developments

  • On Sept. 24, 2009, the OSE announced that it completed the process of making Jasdaq Securities Exchange Inc. into a wholly-owned subsidiary, which will allow the integration of the Tokyo-based market for start-up companies and the OSE's own Hercules market for new companies.[7]
  • On Sept. 15, 2009, NASDAQ OMX Group announced a deal with OSE to provide it with the NASDAQ OMX-based platform for derivatives trading. The platform is scheduled to launch in 2011.[8] [9]
  • On February 3, 2009, The NASDAQ OMX Group and Osaka Securities Exchange signed a Memorandum of Understanding (MoU) with the intent to form a strategic partnership. The partnership includes NASDAQ OMX's delivery of services to further develop OSE's market model, with the objective of growing volumes in both its cash and derivatives markets.[10]
  • In August 2008, OSE and International Securities Exchange terminated their MOU agreement for a jointly-owned equity options trading platform for the Japanese market. At the time, OSE president and CEO said the canceled deal "will allow us to concentrate on growing out core business and further improving our technology platform."[11]
  • On May 27, 2008, Osaka Securities Exchange signed an MOU with the Central Japan Commodity Exchange and the Kansai Commodities Exchange for co-operation among the three exchanges.[12]

In 2009, OSE announced it was joining with New York-based Nasdaq OMX Group to co-operate on developing new derivatives-trading platforms and on cross-listing start-up corporations.[13] OSE hopes to leverage its planned new 2011 derivatives system to compete with larger rival the Tokyo Stock Exchange and on the wider global market.

In June 2010 OSE announced a partnership with Japanese IT provider KVH for its new OSE derivatives trading system that it expected to launch in 2011.[14] OSE chose the KVH Proximity Hosting Service to provide relaible, ultra-high speed connections for OSE's high-frequency traders via KVH's Tokyo Data Center, which will connect to OSE's derivatives-trading network through a high-speed LAN.[15]

References

  1. Japan approves merger of Tokyo and Osaka exchanges. BBC News.
  2. Osaka bourse absorbs TSE derivatives trading. Mainichi.
  3. Tokyo and Osaka Bourses Merge as Japan Exchange Group. Waters Technology.
  4. Tokyo Exchange Merges With Osaka to Form World’s No. 3 Bourse. Bloomberg Businessweek.
  5. OSE Official Website. Osaka Securities Exchange.
  6. CME Group Strategic Partnership with Osaka Exchange. JPX Press Release.
  7. OSE makes Jasdaq into wholly owned arm. Kyoto News.
  8. NASDAQ OMX Selected as Technology Provider to Osaka Securities Exchange. NASDAQ OMX.
  9. Osaka Securities Exchange Contract With OMX Technology And NTT Data. Mondovisione.
  10. NASDAQ OMX and Osaka Securities Exchange Sign Agreement to Form Strategic Partnership. Nasdaq and OSE.
  11. OSE and ISE halt Japanese options platform plan. The Trade News.
  12. MV News. mondovisione.
  13. OSE, Nasdaq OMX Agree to Form Tie-Up in Derivatives Trading. Kyodo News International.
  14. KVH appointed as proximity vendor for OSE new derivatives trading system. Automated Trader.
  15. OSE Appoints KVH as Proximity Vendor for Derivatives Trading System. COMTEX.