Australian Financial Markets Review 98: Towards a Regional Financial Centre

Contents......Page 5
Acknowledgements......Page 10
The Sydney Futures Exchange (SFE)......Page 11
Foreword By Kenton Farrow......Page 12
Foreword By Les Hosking......Page 13
1.2 Financial Markets Overview......Page 14
1.3 Report Overview......Page 17
2.2 OTC Survey Respondents and Coverage......Page 18
2.3 Survey Design......Page 21
2.4 Conclusions......Page 22
3.2 Global Trends......Page 24
3.3 Equity Markets......Page 26
3.4 Domestic Trends......Page 27
3.5 AUD......Page 28
3.6 Conclusion: Outlook for Australian Financial Markets......Page 29
4.2.2 Instruments and Participants......Page 30
4.3.1 Overview of the Equities Market......Page 31
4.3.2 Equities......Page 32
4.3.3 Equity Derivatives — Options......Page 34
4.3.4 Equity Derivatives — Warrants......Page 36
4.4 Conclusions......Page 37
5.2 Nature and Role of the Australian Futures Market......Page 38
5.2.1 The Operation of the Australian Futures Market......Page 39
5.3.1 Overview......Page 41
5.3.2 SYCOM® (Sydney Computerised Market)......Page 43
5.3.4 Treasury Bond Futures and Options......Page 44
5.3.7 Share Price Index Futures and Options (SPI®)......Page 45
5.3.11 Wheat......Page 46
5.4 Conclusions......Page 47
6.2.2 Instruments......Page 48
6.2.3 Participants......Page 50
6.2.4 Recent Developments......Page 52
6.3.1 Government Debt Securities......Page 53
6.3.2 Non-government Debt Securities......Page 59
6.4 Conclusions......Page 66
7.2.2 Instruments......Page 68
7.2.3 Participants......Page 70
7.3.1 Overview of the Negotiable & Transferable Instruments Market......Page 71
7.3.2 Treasury Notes......Page 75
7.3.3 Semi-government Paper......Page 77
7.3.4 Bank Paper......Page 78
7.3.5 Corporate Paper......Page 79
7.4 Conclusions......Page 80
8.2.2 Instruments and Participants......Page 82
8.3 Review and Analysis of the Repurchase Agreement Market......Page 84
8.4 Conclusions......Page 87
9.2.2 Instruments......Page 90
9.2.3 Participants......Page 91
9.3 Review and Analysis of the Cash Market......Page 92
9.4 Conclusions......Page 93
10.2.2 Instruments......Page 96
10.2.3 Participants......Page 97
10.3.1 Overview of the Foreign Exchange Market......Page 99
10.3.3 Outright Forward Foreign Exchange......Page 102
10.3.4 Swap Foreign Exchange......Page 103
10.4 Conclusions......Page 104
11.2.2 Instruments......Page 106
11.3 Review and Analysis of the Currency Options Market......Page 107
11.4 Conclusions......Page 114
12.2.2 Instruments and Participants......Page 116
12.3.1 Overview of the Forward Rate Agreement Market......Page 118
12.3.2 AUD Forward Rate Agreements......Page 121
12.3.3 Non-AUD Forward Rate Agreements......Page 123
12.4 Conclusions......Page 124
13.2.2 Instruments......Page 126
13.2.3 Participants......Page 127
13.3.1 Overview of the Swap market......Page 128
13.3.2 Interest Rate Swaps......Page 133
13.3.3 Cross-Currency Swaps......Page 134
13.4 Conclusions......Page 135
14.2.1 Definition and Role......Page 136
14.2.3 Participants......Page 137
14.3.1 Overview of the Interest Rate Options Market......Page 138
14.3.2 Bond Options......Page 142
14.3.3 Caps and Floors......Page 143
14.3.4 Swaptions......Page 145
14.4 Conclusions......Page 147
15.2.1 The Establishment of the Commonwealth Regulatory Framework......Page 148
15.2.2 Financial Sector Advisory Council (FSAC)......Page 149
15.3 Implications for Australia\'s Position as a Regional Financial Centre......Page 150
15.4 Concluding Remarks......Page 151
Appendix: OTC Financial Market Instrumentation Definitions......Page 152
References......Page 154