Doors open to offshore brokers

The Australian Stock Exchange has relaxed its requirements for offshore brokers, opening the door for new market entrants. The new rules come as two major brokers, Credit Lyonnais Securities Asia and Lehman Brothers, look to increase their presence in Australia. The ASX is in talks with two or three additional brokers. Under the new rules, brokers are not required to have an Australian “shopfront” but can use third-party clearing and settlement agencies. The ASX said the move will allow brokers to directly execute program trades. The new trend in global markets is “black box” or “quant trading” and by adding this alternative to the Australian market overall liquidity should be enhanced, the ASX said.