Twenty years ago, a fifth of futures and options trading took place in Japan. But the market has not kept up with advances elsewhere, and in the last few years volumes at several exchanges have collapsed. Now at last, there are signs that the exchanges have realised the situation is desperate. They are performing long-overdue IT upgrades and launching new contracts – but is it too late? Colin Packham reports.
The Japanese derivatives market is really two distinct markets – financial derivatives, with three exchanges, and commodities, with four. But the apparent strength of these forces is not reflected in powerful results. Trading volumes for most of the exchanges, in fact, have been dire. Now both sectors have begun to grapple with the need for fundamental modernisation.
The financial derivatives market, with its own regulator and individual rules, is serviced by the Osaka Securities Exchange, the Tokyo Stock Exchange and the Tokyo...