Boston, MA, January 7, 2010 – A new report from Aite Group, LLC examines the overall capabilities of the Tokyo Stock Exchange's (TSE's) new technology platform, arrowhead, and its potential impact on the evolution of the competitive landscape in the Japanese equities markets. The report also highlights Japan's need for a new type of broker.
The Tokyo Stock Exchange has bet its future on the launch of arrowhead, a new technology platform enabling the TSE to bridge the IT infrastructure gap that remains between the TSE and other major global exchanges. The platform promises to deliver increased system capacity and reduced latency, faster and deeper market data, colocation services, and a series of important trading-rule changes, such as a reduction in trading tick-size and daily market price change limits.
Given the implementation of such fundamental and long-term changes in the Japanese equities market, buy-side participants seeking to flourish in the new trading environment can no longer afford to rely on traditional brokerage services. Rather, customers must seek out products and services provided by next-generation brokers that capably deliver not only market guidance, but also rich connectivity and sophisticated electronic services.
"The TSE enters uncharted territory with its launch of arrowhead, which could lead to either a further tightening of its stranglehold on the Japanese equities market or an unintentional loosening of its near-monopoly status," says Sang Lee, managing partner with Aite Group and author of this report. "Regardless, the move is the TSE's implicit acknowledgement that a technology-driven market structure is a permanent trend with far-reaching consequences for the future development of the Japanese equities market - a move that will forever alter Japan's equities trading landscape."
This 16-page Impact Note contains nine figures. Clients of Aite Group's Institutional Securities & Investments service can download the report.