Singapore Commodity Exchange

Abstract:

Singapore Commodity Exchange regulated by International Enterprise Singapore ensures that the trading of futures contracts are in accordance with the statutory acts and exercises an optimum degree of transparency. The main product of the commodity exchange is rubber and the futures contracts are traded through ring sessions.

Since the year 1920, trading of rubber as futures has occupied the center stage in Singapore. During that period the Singapore International Chamber of Commerce Rubber Association was responsible for the clearing activities pertaining to transaction in futures. The Rubber Association of Singapore, which underwent privatization in the year 1992, took over the responsibility of the clearing facilities and was known by the name RAS Commodity Exchange. Finally, in 1994 February, Singapore Commodity Exchange got its present name.

Automated trading system:

Several statutory acts supervise the operations of the Singapore Commodity Exchange. The commodity exchange has a well networked computerized system, which connects the sellers and the buyers although it is seldom that they meet. This allows the traders to avail an optimum system of price discovery.

Main future product:

Rubber has been the primary product of trade since it started operating. As such, very experienced as well as efficient rubber traders and rubber brokers remain associated with this commodity exchange. They are considered as a group providing considerable liquidity.

International Enterprise Singapore-Its regulator:

Singapore Commodity Exchange has global presence. This exchange is marketed by the International Enterprise Singapore through as many as 35 offices worldwide. The International Enterprise Singapore also regulates the operations of the commodity exchange.

Procedure of future trading in Singapore commodity exchange:

The fully computerized trading network is referred to as TIDY and NEAT. These connect the several brokers, individual traders and "market makers" with that of the Exchange. The trading related data is made available to the traders around the globe.

Ring Sessions in trading:

For trading contracts of rubber futures, the ring sessions have been taking place since the year 1996, September. The ring sessions are fully computerized. This system aims at improving the trading procedures and making the entire trading system more transparent. During the ring sessions, usually TIDY system is made use of.

Restriction imposed during the ring sessions(TIDY system):

There is one restriction during the TIDY sessions and that is the TSR20 as well as RSS3 cannot be traded.

Future contracts of the following commodities are traded on the Singapore Commodities Exchange.

• TSR20
• Robusta coffee
• RSS3
• RSS1

R&D activities:

Singapore Commodity Exchange carries out extensive research and development work for the improvement of futures trading. It makes the common man realize the importance of futures contract as well as futures trading.