Korean Markets Profit from the Adoption of FIX – FIXGlobal Face2Face Electronic Trading Forum, Korea: October 2010
Having visited Korea in November of 2010 and started a discussion on FIX and electronic trading, the FPL team returned to the Westin Chosun in downtown Seoul to continue the conversation. With over 200 delegates in attendance it was clear that there is a growing appetite in Korea on the subject of FIX and the benefits that increased adoption would mean for the Korean market going forward.
As the competition amongst Exchanges in Asia continues to intensify, there was a clear exchange focus throughout the day, with the CME, Deutsche Borse and KOSCOM joining in. CME has partnered with the Korean Exchange (KRX) to position the Korean market as a financial centre through their Globex Platform. Tae Seok Yoo, Director and Head of Strategic Sales Asia at CME Group, took to the stage and pointed out that Korea is the #1 Derivatives Market globally; however, in order to have an active derivatives market you need an active cash market and technology has a very important part to play. Investment is crucial and the adoption of FIX by KRX and KOSCOM will have repercussions on the landscape of the Asia market.
Local participation on the day was apparent, as David Lee, CEO of DataRoad, who has been involved with FIX from the start in Korea, shared some insightful facts and perspectives. Users of the FIX Protocol in Korea break down fairly evenly at approximately 50% in the Securities and Futures arenas, however, this percentage drops further across the asset management community, where only 30% are trading via FIX. It is felt that increased understanding of the FIX Protocol and the challenges presented by non-standard FIX implementations that exist in Korea would prove advantageous and assist in growth of the FIX Protocol in Korea. It was suggested that the establishment of a local FIX user community and further FIX Protocol education would be beneficial, and that communication of the lessons learnt by other firms from the international FIX community, that have benefitted from implementation experience and expertise could prove valuable to the Korean market.
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