Osaka Exchange

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Osaka Exchange
OSE-200px.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.jpx.co.jp/english/


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[edit]

The origin of securities exchanges in Japan stems from the Edo Period, between 1603 and 1867, 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.

On July 27, 2020, the Osaka Exchange began futures trading in commodities including gold, offering the first one-stop trading platform in Japan for financial and commodities futures.[7]

Key Partnerships and Developments[edit]

  • 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.[8]
  • 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 our core business and further improving our technology platform."[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]
  • 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 launched in 2011.[11] [12]
  • On Sept. 24, 2009, the OSE announced it had completed the process of making Jasdaq Securities Exchange Inc., which it acquired in 2008, into a wholly-owned subsidiary, which allowed the integration of the Tokyo-based market for start-up companies and the OSE's own Hercules market for new companies.[13]
  • 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.[14] 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.[15] 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.[16]
  • In July 2011 Osaka Securities Exchange and CME Group announced an expansion of their partnership with a strategic arrangement to cooperate on joint product development, marketing and promotions. Under this arrangement, the companies offer Japanese yen-denominated products for their global customer base. OSE lists futures contracts based on the Dow Jones Industrial Average, and CME Group offers an E-micro futures contract based on the Nikkei 225 Average, both denominated in Japanese yen.[17]
  • On September 20, 2021, Osaka Exchange and Tokyo Commodity Exchange (TOCOM) launched their new derivatives trading system, J-GATE3.0. They also completed the expansion of trading hours and the transfer of the J-GATE3.0 backup function to the Kansai Data Center. The new system replaces the previous trading system, which had been in place since July 2016. It is part of JPX's enhancement of OSE's position as its western hub and the expansion of its functions.[18]

Products[edit]

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.

People[edit]

Contract Volume[edit]

Year Total Annual Volume Percent Change World Ranking
2017 322,408,620 (-)4.5% 16
2016 337,537,333* (-) 6.6% 17
2015 361,459,935* 16.7% 16
2014 309,732,384* (-) 15.4% 15
2013 366,145,920* 5.65% 14
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 -- --
  • Volume for Japan Exchange as a whole, after exchange merger


References[edit]

  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. ↑ Japan's first integrated stock and commodity futures bourse opens in Osaka. Japan Times.
  8. ↑ MV News. mondovisione.
  9. ↑ OSE and ISE halt Japanese options platform plan. The Trade News.
  10. ↑ NASDAQ OMX and Osaka Securities Exchange Sign Agreement to Form Strategic Partnership. Nasdaq and OSE.
  11. ↑ NASDAQ OMX Selected as Technology Provider to Osaka Securities Exchange. NASDAQ OMX.
  12. ↑ Osaka Securities Exchange Contract With OMX Technology And NTT Data. Mondovisione.
  13. ↑ OSE makes Jasdaq into wholly owned arm. Kyoto News.
  14. ↑ OSE, Nasdaq OMX Agree to Form Tie-Up in Derivatives Trading. Kyodo News International.
  15. ↑ KVH appointed as proximity vendor for OSE new derivatives trading system. Automated Trader.
  16. ↑ OSE Appoints KVH as Proximity Vendor for Derivatives Trading System. COMTEX.
  17. ↑ CME Group and Osaka Securities Exchange Form Partnership. Finextra.
  18. ↑ New derivatives trading system J-GATE3.0 has gone live. Japan Exchange Group.
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