TRADING SYSTEM - HKATS
The Futures Exchange’s first electronic screen-based trading system, the Automated Trading System was introduced in November 1995. In Oct 2013, the trading system, Hong Kong Futures Automatic Trading System (HKATS), for the derivatives market has been upgraded to a new technology platform, Genium INET.
This new technology platform will be able to achieve significant improvement in order capacity, clearing capacity and ultra-low order processing latency to support our further development in the derivatives market, especially in improving the liquidity of the stock options market.
HKATS is a transaction-based network system. Trading on HKATS can be conducted through HKATS Click workstations or independently supplied workstations connected through Omnet Application Programming Interface (OAPI). With HKATS, users can view real-time price information on a computer screen, click on a bid or ask price and execute an order.
ACCESS TO MARKET
Exchange Participants may access HKATS directly through workstations (with an interface program) or an application programming interface (API).
The minimum requirement for each HKATS access connection is one personal computer, two SDNet lines, two routers, a switch, connection cable(s) and the application software. Details of the equipment requirement and estimated set-up costs and running costs which an Exchange Participant is required are described below.
Exchange Participants which want to install more than the maximum number of connections allowed at any location, using multiple APIs per workstation or having trading workstations at different locations will need to acquire additional lines, routersand switches .
Participants can directly connect to the HKEX host servers via Central Gateways as the primary access points. These Central Gateways are located on the high speed message bus of the central system and thereby provide significant improvements in transaction latency.
APPLICATION PROGRAMMING INTERFACE (API) APPROACH
The API is the customer interface to HKATS. The interface enables programming of fast and reliable business transactions. All trades are synchronous and sequential, i.e., the API processes only one transaction and process at a time. However, a single transaction may contain many operations, requests or orders, forcing central resources to process different requests concurrently.
Through the use of the API, Exchange Participants can connect their in-house trading front ends, clearing and risk management systems to HKATS.
CLICK WORKSTATION APPROACH
Each CLICK workstation is installed with an interface program, Click Trade, which connects HKATS users through a Network Gateway in Exchange Participant’s site to the central marketplace. CLICK Workstation will be available from HKEX for installation as the trading frontend software in the initial rollout of Genium INET Platform but support for the software will ultimately be discontinued, tentatively in 2017.
How to market participants benefit?
HKATS creates a fair, efficient and accessible market place for all market participants. HKATS equips market participants with comprehensive real-time market information, putting them in a stronger position to capture investment opportunities.
- Level Playing Field
All HKATS participants, whether they are retail investors, institutional investors or market makers, trade in one centralised market place. In addition, there are no time and place advantages as all orders are executed electronically based on strict price/time priority.
- More Efficient Trading
With HKATS, orders are placed through HKATS workstations at Exchange Participants' offices. The system then automatically matches the orders with corresponding buy or sell orders in real-time based on price/time priority. The trade information is captured and reported back to the Exchange Participants who can confirm the trades with the clients immediately.
- Lower Costs
Experience elsewhere has shown that electronic trading leads to lower operating costs for Exchange Participants in the long run, and that often leads to lower transaction costs for their clients.
- Enhanced Customer Service
Traders can provide full electronic order routing, straight-through trade processing, internet trading and other value-added services to clients.
One of the great advantages of HKATS is that it can easily accommodate the introduction of new products and extended trading hours.
In order to trade through the new HKATS environment, at least one pair of SDNet/2 lines with modems and routers, one switch/hub, and LAN connection cables are needed. Exchange Participant can choose to connect to HKATS through central gateway and/or network gateway.
You may refer to the Appendix for
- The system configuration of CLICK workstation
- Details of estimated set up costs and running costs of HKATS with network gateway and one CLICK workstation
- Details of estimated set up costs and running costs of HKATS with one OAPI connection with throughput of 5 transactions per second to central gateway