PRESENTATION OUTLINE
PANEX is the First and only multi-currency, multi-asset exchange in the world. The exchange was first conceptualized in 2008 as a virtual exchange to operate a futures market in Kenya, but since then the company has changed its mandate to establish a fully fledged financial exchange offering a diverse group of financial instruments thought out Africa. The company holds subsidiaries in Zambia and Ivory Coast.
As a derivative exchange, PANEX is not limited to soft commodities only. It will offer a diverse array of products just like any other exchange around the world. This makes it dynamic and attractive to traders who are looking for arbitrage opportunities from around the world.
The exchange offers the following products:
Agriculture Derivatives
• Metal Derivatives
• Energy Derivatives
• Currency Derivatives
• Freight Derivatives
• Stock Derivatives
• Forex(ECN)
• Interest Rate derivatives
• Weather Derivatives
• CFDs
• Binary Options
• Warehouse receipt Financing
• Warehouse Receipt bonds
• Animal-Repo Financing
The Stock exchange is the second market to be operational and it will act as a premier market place to list companies from across the continent. The SME segment, private equity and venture capital lists in the private market. The market acts as an exit or entry point for accredited investors.
The exchange offers listings of DR and Eurobonds for African companies and governments. We target African based companies that are listed in London AIM and OTC markets in NY and attract them to the main board by offering multi-currency listing. The exchange also lists Mutual Funds, ETFs and other instruments.
The trading platform is already integrated to over 15 major currency liquidity providers. To create and attract foreign liquidity in the equity and derivatives markets, the exchange will be linked to several service bureaus which provide connectivity to international markets.
PANEX is commercially viable and profitable. The exchange is fully electronic with servers located in New York, London and Nairobi. The exchange operates a hub and spokes or white label franchise models. PANEX has installed one trading Platform that is utilized in all countries and regional exchanges.
Matching Engine
The matching engine is already used by an ATS here in the USA. It is used as a high frequency matching and trading platform aggregating pricing from different exchanges, ECN and dark pool and sending trades to the right market for a particular trade.
Brokerage Platform
The brokerage platform is a mullti-currency and can trade stocks, futures, option, Hybrid Options, forex and even bonds. It is a white label solution so it can be implemented to multiple players using the same instance. It can be provided as a SAS or outright buy where the exchange owns the licenses and it rebrands it to its brokers.
Clearing House
The clearing platform is used here in the US. It can clear 3 million trades an hour. It is multicurrency; it clears all products traded on the exchange and will be supplied as SAS.
Electronic warehouse Receipt System
The EWR can store receipt for an unlimited number of receipts. It can be used in different countries and can be used for an unlimited number of crops. We can white label it if there is an instance where a country insists on a national exchange. ACFEX own the software.
We operate two markets across the continent; the derivative exchanges or “commodities exchanges” as they are commonly known and equity exchanges. The markets are ACFEX (Africa commodities and Futures Exchange) and AFMEX (Africa Financial Markets Exchange). ACFEX has already been chosen as the commodities exchange implementing partner to CAADP (The Comprehensive Africa Agriculture Development), which is administered under the Conference of West Africa and Central Africa ministers of Agriculture the body responsible to develop market access across the continent on behalf of NEPAD under CAADP. And we currently have operations running in Ivory Coast.
The exchange is a fully encompassed technology company. Our software design has helped us eliminate the trading friction that is usually encountered by our clients. The technology has also helped reduce errors and make our market transparent and efficient. Our long term infrastructure investment has lead to better design of our software’s and data center infrastructure.
The exchange has fully integrated all its software through the FIX protocol. We have also created a SOAP interface for our own internal use. The FIX protocol has become the defacto standard of exchanging information in the financial industry.
All brokers, traders and clearing members will be supplied a full suite of software including the front and back office solution for their particular needs.
All PANEX trading platforms are used in various markets across the world. The matching engine is used in the USA for high frequency trading. The platform has passed different region testing and met all requirements in the USA. The surveillance and Risk management section used by the ATS is also used in the US by various ETC and other financial institutions. The brokerage platform is used in the USA, Australia, Asia and Poland.
The clearing platform clears about 750 million dollar weekly in various clearing firms in the US making it a very stable system. It clears over 3,000,000 trades an hour. PANEX EWR has been developed with stability by a team, which has developed systems for hedge funds and other financial institutions across Europe.
The PANEX matching engine is used to match trades as it implies. The matching engine is powerful software that runs and does complex calculation on how orders are going to be matched. It provides price discovery and then broadcasts the prices to the general public through a feed.
The PANEX matching engine has been tested and has met sub-milliseconds matching of orders with no or very little latency.
The Matching engine will be the fastest in the continent. We are currently working on the next version, which is designed to match between 3million to 5 million trades a second.
The exchange is electronic and virtual. It is the first to provide multi-currency real time quotation for any asset class simultaneously. A product can be quoted in Rwanda Franc, kwacha, Shilling, rand, Dollar, Euro etc simultaneously. PANEX pricing & matching engine uses time-price priority matching, giving a full transparent market for all orders as well as providing full anonymity.
Surveillance/ Risk Management
Risk Management and surveillance section is responsible for real-time computation of account position values, P&L and risk exposure. RMS captures orders, trades and market data updates as Order Router publishes them out within the matching engine and Market Data Feeder. It then recalculates and saves risk values in the database. Optionally, RMS can publish computed values to other databases. RMS controls functions, including real-time accounts and global position monitors, account risk monitors, "manual" fill, fill correction and position modification screens.
Brokerage
We have realized over the past several years that front; middle and back office systems are very important infrastructure segments and yet expensive for individual brokers to buy. The exchange has acquired licenses that will be distributed to the brokers as a turnkey solution. PANEX trader is the Brokerage trading platform. The platform is a fully electronic system, which is Internet and client ready.
The trading platform provides the ability for anyone to trade from anywhere in the world. They can trade from computers or phone applications running on Iphone, blackberry, android, windows mobile and Nokia symbiam. Customers can trade independently or with the help of a broker. It is multi-currency and handles all securities, derivatives and spot forex. PANEX trader is already connected to over 15 international liquidity providers including JP Morgan, Saxo bank etc. The brokerage platform is linked to the clearing member and clearinghouse via Fix.
Clearing Corporation System
Clearing is segmented into two. Acfex Brokerage System (ABS) and Africa continental Clearing System (ACCS). The brokers use the ABS while the clearinghouse uses the ACCS. The Clearing software currently clears between 750 million to 1 billion dollars daily. Transactions will be passed to both the ABS and ACCS in real time via FIX messages creating a mark to market. The clearing corporation will establish the Initial and variation margin on real-time and end of day basis.
The clearing House will create an end of day Transaction Summary and Cash Settlement sheet for each PANEX Clearing Member (ACM) who had activity that day. Each ACM will satisfy their daily settlement obligation between their Custodial Bank and the ACCS Settlement Bank. ACCS will provide each ACM with an End of Day Position Report (and/or file) that should be reconciled by each ACM to ensure agreement with the ACCS. Both ABS and the ACCS will generate real time and historic reports for the regulator. The format will be determined in consultation with the SEC. NO Exchange member/broker will be allowed to handle client funds. Custodial and Clearing Banks will handle all funds.
PANEX Electronic Warehouse Receipt (PANEX EWR)
PANEX EWR is a fully electronic warehouse receipt system that will be used by the exchange to issue and maintain receipts that are issued and traded throughout the exchange. PANEX EWR eliminates the responsibilities relating to physically handling and safeguarding warehouse receipts. It also centralizes the issuance of receipts, keeps all transactions for auditing, provides immediate information to government agencies, and processes available grain for sources as well as being an undisputed evidence of ownership.
