SGX Derivatives Trading System & Market Structure (SGX-DT)
SGX-DT is Singapore's approved derivatives exchange; every trade on it is cleared by SGX-DC through a Clearing Member. RES 2A tests the market's structure — MAS over SGX RegCo over members — the two classes of trading member, how representatives are registered, the T and T+1 sessions, the product families, the order and trade types (limits, crosses, strategies, negotiated large trades, error trades), position limits and accountability levels, and the customer-protection and conduct rules in the Futures Trading Rules.
5 sections·~3 min read
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Must-know for the exam
✓SGX-DT = approved exchange for derivatives (MAS supervised; SGX RegCo is the frontline regulator). SGX-DC = approved clearing house. SGX-ST/CDP are the securities-side pair.
✓Trading members: General Trading Members and Bank Trading Members; every trade clears through an SGX-DC Clearing Member (a Dual Member holds both). Non-members access the market only through members.
✓Individuals must be SFA appointed representatives AND exchange-registered (Approved Traders / Registered Representatives); competency = RES 2A (MAS Notice SFA 04-N22).
✓Sessions: T session (Asian hours) and T+1 overnight session into the early morning; T+1 trades are booked to the next trading day.
✓Products: FTSE China A50, Nikkei 225, MSCI Singapore, FTSE Taiwan index futures/options; FX futures; iron ore, rubber. Index futures are cash-settled via a multiplier.
✓Order book: price then time priority. Cross trades, strategy trades and negotiated large trades are permitted under conditions; error trades outside the no-cancellation range can be reviewed.
✓Position limits are ceilings; accountability levels trigger reporting and possible directions. Front-running, order disclosure, churning, wash trades and trading against customers without consent are prohibited.
✓Risk disclosure statement before trading; customer money segregated; fidelity fund compensates for member defalcation (not market loss).
Who regulates what
•Under the SFA, MAS approves and supervises SGX-DT (an approved exchange) and SGX-DC (an approved clearing house). SGX RegCo, the group's independent regulatory subsidiary, performs frontline regulation: member supervision, surveillance, enforcement and discipline. The Futures Trading Rules run to nine chapters — general matters, access and membership, conduct, listing and trading of contracts, physical delivery, dispute resolution, adverse events and discipline, definitions, transitional provisions.
•Exchange rules add to the SFA; they never subtract from it. The same front-running episode can be an exchange disciplinary matter, an MAS regulatory action and an SFA offence.
Membership and representatives
•General Trading Members are typically CMS licence holders; Bank Trading Members are banks exempt from the licence. Trading membership does not confer clearing rights: a non-clearing member must contract with an SGX-DC Clearing Member that guarantees and clears its trades. Admission criteria cover capital, financial resources, systems and fit-and-proper management.
•Representatives are registered twice over: appointed under the SFA (with the RES 2A competency requirement) and registered with the exchange as Approved Traders or Registered Representatives, bound by the rules and by know-your-customer duties. Retail investors are customers of members and never face the exchange directly.
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