SK C&C to Spearhead Establishment of Korea’s First Alternative Trading System
SK C&C, the information communications technology arm of South Korean conglomerate SK Group, is set to launch the country’s first Alternative Trading System (ATS) — a securities trading venue that is more loosely regulated than an exchange — in the second half of next year.
The firm announced on Wednesday that it will commence the multilateral trading system construction project for Nextrade, a corporation dedicated to preparing the ATS.
Collaborative effort of securities institutions
Nextrade was initiated by seven securities firms, including the Korea Financial Investment Association, and was jointly established by 34 participating institutions, including 19 securities companies, three securities-related institutions, and four tech companies in November of last year.
SK C&C in particular has been working with Nextrade since 2019. When the corporation was still a consultative body of securities firms, the SK subsidiary was in charge of consulting on various matters regarding the establishment of the ATS and functional system requirements.
Establishing a solid foundation
The aforementioned construction project aims to establish a multilateral trading system and an operation and management system to support the trading, brokerage, and agency functions of listed securities and depositary receipts on the ATS, which Nextrade will proceed with upon its official approval in the second half of next year. SK C&C will take on a major role in leading this task.
“Based on our digital IT service capabilities that we have accumulated within the financial sphere, we will establish an efficient and reliable multilateral trading system that is on par with regular exchanges,” said Kim Nam-sik, head of the SK C&C Financial Digital2 Group.
Besides facilitating multilateral trading, SK C&C will develop an information distribution system that processes investment information in connection with the Korea Exchange and the Korea Securities Depository, as well as a trading support system responsible for product information management, trading statistics, and administration.
Trading after hours
The ATS will allow trading past normal trading hours, which are usually from 9 AM to 3:30 PM — an especially attractive selling point for buyers and sellers. This will be made possible by compiling product information based on closing prices after the market closes, which will create an environment that allows for trading after hours.
This service will not only be convenient for office workers but also help them refer to official announcements and the status of overseas markets to make more informed decisions, SK C&C said.
Securities that can be traded after hours will be limited to listed stocks and depository receipts on the Korea Exchange for the time being, but SK C&C is reportedly looking into allowing trading of security tokens, non-security virtual assets, and NFTs.
Ensuring uninterrupted operations
Notably, there will also be a Disaster Recovery Center, which will serve to protect the ATS’ major systems and data assets and ensure business continuity. A data backup system will be set up to reduce backup time and swiftly recover from any failures in case of potential security threats.
Furthermore, the ATS plans to introduce new types of orders to enhance investor benefits in the domestic capital market, setting it apart from the Korea Exchange.
