The Tokyo Commodity Exchange, Inc. (“TOCOM” or “the Exchange”) announced today a new three-year Midterm Management plan covering fiscal 2013 through fiscal 2015.
The Exchange has adopted annual, rolling updates of its three-year Midterm Management Plan in order to quickly address changes to the business environment.
The average daily volume for fiscal 2012 was 108,000 contracts, down 14% from fiscal 2011. The Eurozone crisis and the global economic slump created anxiety that persisted through fiscal 2012. This resulted in risk-averse behaviour across markets.
Toward the end of fiscal 2012, market sentiment in Japan began leaning toward an expected recovery, in part due to a devaluation of the yen and subsequent advance of stock prices. These positive trends are pushing volumes up on TOCOM’s market as well. In the long-term, however, it is unclear whether these trends will continue.
The Midterm Management Plan rests on six pillars that, with determination, will be used to incrementally implement various measures. The core strategy is to increase trading volume by attracting a diverse set of market participants and promoting participation through more and varied market intermediaries.
- Market Participants: Strengthen sales efforts to attract a diverse set of market participants;
- Product lineup: Enhance the product portfolio;
- Market design: Further improve market convenience and reliability;
- Business base: Bolster the business base in ways that promote commodity market growth;
- Clearing services: Further develop and strengthen clearing functionality;
- Support Image: Support the image of commodity futures trading in Japan
In addition, TOCOM will pursue further cost reduction to reduce overhead (i.e., reduce the level of trading volume needed for operations to remain profitable) through a fundamental review of the cost structure.
For more details, please refer to the “Midterm Management Plan (Fiscal 2013-2015)".
