Magnus Bocker, who led the $SGX(S68.SI) after the global financial crisis, has died of cancer at the age of 55. Here’s how SGX faired under him.

Prior to Mr Bocker’s role as SGX CEO from 2009 to 2015, he was the President of the Nasdaq Stock Market, and before that, he was the creator of OMX, the Nordic exchange. Mr Bocker held over three decades of experience in the financial industry and was often regarded as a driving force for change.

Here’s a recap of Magnus Bocker’s journey and some of the significant events during his tenure with SGX:

FY2009-2010
Mr Bocker stated then that the 3 reasons why he decided to join SGX were:

1. He saw a paradigm shift from the West to East, and he thought that Asia will play a far more significant role in the years to come, opening up new opportunities for SGX

2. Singapore was recognised as the world’s easiest place to do business, and the world’s 2nd leading financial centre after New York due to our policies, stance, approach and trade agreements. Singapore has also developed a strong regulatory framework and tax-friendly policies

3. SGX’s ability to reinvent itself and emerge as leader in market development, and he believed that SGX will continue to thrive as the Asian Gateway

Mr Bocker attempted to merge SGX with ASX in 2010. SGX offered $10.7b to take over ASX to form ASX-SGX, which will form the 5th largest listed exchange group, and the deal will create an expanded platform for global customers to exploit opportunities in the Asia-Pacific region. Mr Bocker said that by 2020, nearly half of the global GDP will be in Asia-Pacific, and it was an opportunity he could not let go. However, all these will eventually fall due to political opposition in Australia.

Quoted by The Telegraph,

"Magnus Bocker, said that “in 2020, in less than 10 years from now, nearly half of the global GDP will be in Asia-Pacific.”

“It’s an opportunity that we cannot let go,” he added in a news conference.

In terms of total number of listings, the ASX-SGX will overtake Tokyo to become the second largest listing venue in the Asia-Pacific region after Bombay, offering more than 2,700 companies from over 20 countries including 200 from Greater China, the joint statement said.

The merged bourses will also offer access to the largest institutional investor base outside the United States, with combined assets under management estimated at $2.3 trillion including money from sovereign wealth funds."

However, the plans to merge SGX with ASX never materialized.

FY2011

A total of $20.8b was raised on SGX. IPO of Hutchison Port Holdings was the largest to date in Southeast Asia, at US$5.5b. SGX was the most international among exchanges, with 41% of listed companies coming from more than 20 countries. This included 150 China companies, the most for any exchange outside of China. Being a firm believer in corporate governance and responsible investing, Mr Bocker helped to develop guidelines and promote the importance of Sustainability Reporting. Mr Bocker also invested heavily to upgrade SGX’s trading engines and technological infrastructure, demonstrated by the opening of a state-of-the-art SGX Data Centre, as well as the launch of the world’s fastest securities trading engine.

FY2012

The IPO market saw a sharp downturn with only $825m raised. Thankfully, the derivatives market continued to gain from increased levels of risk management activities, and SGX became the largest offshore market for Asian equity derivatives. There was relatively low retail investors participation due to risk adverseness since the GFC, hence Mr Bocker led the team to embark on a wide-ranging plan to stimulate retail activity. Mr Bocker decided to remove the lunch break although he faced protests from remisiers, and reduced the minimum bid sizes for securities to lower market participation costs for investors. In recent news, these efforts are soon going to be reversed when SGX announced that they will be bringing back the lunch break.

To boost liquidity, SGX under Bocker provided rebates for high-frequency market makers, but this raised concerns and many argued that doing so would prejudice retail investors.

According to The Business Times,

"Such a possibility has to be considered partly because Singapore is a single-exchange market. In more fragmented and deeper markets such as the United States, high-frequency traders can make money by arbitraging price differences between exchanges or correlations within markets.

In Singapore, those opportunities exist mainly in the derivatives market, where about 30 per cent of volumes are already attributed to high-frequency players. With derivatives contracts, traders can exploit inefficiencies through parallel products that trade elsewhere in the world, for example."

FY2013
SGX reported the highest net profit since 2008. Past year’s efforts paid off and there was a rebound in trading activities and an increase in retail participation.

FY2014
SGX experienced a decline in value of securities traded, caused mainly by the reduction in trading of small-cap stocks due to the penny stock saga that wiped $8b off the value of 3 shares(Asiasons Capital, Blumont Group and LionGold Corp). Since then, SGX tightened their processes to better protect the interests of investors.

According to The Business Times:

"The fallout had reverberated to a wider band of penny stocks, most of them connected through a tangled web of common shareholders or directors. The penny stock rout on the fateful morning of Oct 4, which wiped out S$5 billion in market value in the three counters within the first hour of trading, had led Singapore Exchange (SGX) to suspend trading in the counters; it later slapped a two-week trading curb on them which some say had exacerbated the losses."

Prior to Mr Bocker leaving in 2015, SGX came under fire for a number of serious trading outages.

According to The Straits Times:

"The Nov outage in SGX – home to one of the most established capital markets in the Asia Pacific – caused a malfunction, which meant the line prices stopped moving, causing panic in the markets.

A Board Committee of Inquiry was set up after the Nov incident to independently oversee probe into the incident, review the bourse’s incident management and crisis communications.

MAS also issued directives to SGX for several remedial actions, including strengthening of its monitoring system capabilities to allow timely and accurate problem identification, improve crisis preparedness and improve its crisis communication to provide prompt information to all stakeholders."

There seemed to be some unhappiness from the public during this period of time, as seen in this petition.

Casting aside the negative instances, one thing for sure is that SGX successfully emerged stronger after the GFC under the leadership of the late Mr Bocker.

It is now up to the current management to navigate through the current challenges and bring SGX to greater heights.

SGX’s current price is $7.59. It’s YTD capital gains is around 6% and dividend yield is around 3.7%

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The 6 Stocks Which Grew More Than 5% In Price In A Month

With the trade talk between China and US being resumed after the G20, both Singapore and HK markets rallied big time. It's time to spot some potential stocks!

Let's look at 3 Hong Kong stocks that have caught the public's eye:

According to Reuters, on 27th June Shares in Hong Kong rose on Thursday, extending the previous day's cautious gains, as investors' hopes of a trade truce between the United States and China rose ahead of a highly anticipated meeting between the countries' leaders. At the close of trade, the Hang Seng index was up 399.44 points or 1.42% at 28,621.42, adding to the previous day's 0.1% gain.

The top gainer on the Hang Seng was Sunny Optical (2382 HK)-mainland China’s largest manufacturer of smartphone camera modules and lenses which gained 4.03%. Sunny Optical is also up by at least 20% within a month. If you have a 5x leverage, it would be more than 100% gain!

Besides Sunny Optical Technology Group Co Ltd, AAC Technologies (2018 HK)-acoustic components supplier to Apple Inc also rose 7.1 per cent to HK$47.50 as reported by South China Morning Post. It has also risen more than 10% within a month. If you have a 5x leverage, it amounts to more than 50% gain!

The third HK stock would be Sands China (1928 HK) – subsidiary of Las Vegas Sands Corp, currently operates The Venetian Macao, Sands Macao, The Plaza Macao, Sands Cotai Central and The Parisian Macao. Macau’s casino operators have pledged billions of dollars to develop non-gaming attractions in a bid to secure new licenses, but analysts predict only the more efficient like Sands China and Galaxy will be able to curb losses and emerge winners. Analysts are also bullish on Macau’s long-term fundamentals given it is China’s only legal casino hub, its greater connectivity to the mainland and massive growing middle class as reported by Reuters. Sands China rose more than 10% within a month. If you have a 5x leverage, it would give you more than 50% gain!

Now back to the local stocks, we have three blue-chip Singapore names which the market has been longing for: SGX, City Development, Singapore Airlines.

From FY2014 to FY2018, Singapore Exchange’s earnings climbed 13.4% from S$320 million to S$363 million, an increase of around 3.36% per annum. The growth is supported by its revenue rising from S$686 million to S$845 million during the same time frame. As of the end of June 2018, Singapore Exchange’s balance sheet carried S$831.6 million in cash with zero debt. It had an ROE of 34%, which is considerably high. Singapore Exchange’s current share price is at S$7.94, translating to a price-to-earnings (PE) ratio of 23.47 and a dividend yield of 4.72%. It rose more than 5% within a month and if you have a 5x leverage, that would be 33% gain!

In the earlier part of June, The Business Times named CITY Developments Limited (CDL) as one of the hot stocks to look out for. CDL gained more than 5 per cent in the early session on its renewed offer for all remaining shares in London-listed subsidiary Millennium & Copthorne hotels (M&C). Traders told The Business Times that CDL's share price may have also been given a lift due to growing optimism that the US Federal Reserve is looking at the possibility of rate cuts. It rose more than 15% within a month and if you have 5x leverage, it would be close to 75% gain!

Lastly we have Singapore Airlines(SIA) which rose more than 5% within a month. If you have a 5x leverage, the gain would be more than 25%!

How can you leverage up 5x without using margin or CFDs?

Simply by using a derivative called Daily Leverage Certificates (DLC). It is a derivative issued by Societe Generale, and listed on the Singapore Exchange (SGX). Learn more here: https://dlc.socgen.com/en/product/search

Here's the new batch of DLCs just released on 3rd July 2019:
$SUNNY OPTICAL(2382.HK) , $AAC TECH(2018.HK) , $SANDS CHINA LTD(1928.HK) , $SIA(C6L.SI) , $CityDev(C09.SI) , $SGX(S68.SI) .

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