INTRODUCTION TO CHI-X ASIA PACIFICSEPTEMBER 2019

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Chi-X Asia Pacific Overview

Chi-X Japan• A leading Proprietary Trading System (PTS) in

Japan, provides members and investors with better trading opportunities at lower cost under highly transparent rules.

• Operates four equity trading venues to provide solutions to evolving needs of market participants.

Chi-Tech (Hong Kong & Philippines)• Provides the trading

technology platform and support services that keep the Chi-X market centers at the forefront of the industry in performance and reliability.

Chi-X Australia• The securities and derivatives exchange

transforming the Australian investment market through a focus on customers and innovation.

• Delivers easy, cost-effective access to local and global investments opportunities.

An Alternative Market Operator, Provider of Innovative Market Solutions in the world’s #2 and #3 equity markets.

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“Chi-X” Brand and History

Instinet (USA)

• 1969 Instinet founded as a pioneer of electronic trading.

• 2002 Instinet merged ECN business with INET, which was retained by NASDAQ in 2005 after acquisition and sales.

• 2007 Instinet acquired by Nomura.

Chi-X Europe (Europe)

• Chi-X Europe was established in 2007 by Instinet. Rapid expansion of its market share made “Chi-X” a premier brand name in the global execution industry.

• After being managed as a consortium of major global financial institutions, Chi-X Europe was acquired by Bats Global Markets in 2011. Bats Chi-X Europe

remained to be the second largest equities market operator in each EU country. Bats Global Markets was acquired by CBOE in February 2017.

Chi-X Global (Canada, Japan, Australia)

• Chi-X Global, 100% ownership of Instinet, was established to provide alternative trading venues outside of Europe and USA.

• Launched Chi-X Canada February 2008, Chi-X Japan July 2010, Chi-X Australia October 2011.

• NASDAQ completed the acquisition of Chi-X Canada in February 2016.

Chi-X Asia Pacific Holdings (CXAPH)

• J.C. Flowers acquired Chi-X Global (excluding Canada) 100% in February 2016 and established CXAPH.

• Chi-X Japan - first and only broker-neutral equity PTS in Japan, operates 4 trading books.

• Chi-X Australia - second largest regulated exchange in Australia, offers trading in equities and listings for Warrants, ETFs, “TraCRs”.

• Chi-Tech (Hong Kong & Philippines) - technology service and development units supporting regulated market centers Japan and Australia.

The name Chi-X is derived from the Greek letter “χ” symbolizing the crossing of the two sides – new/old and sell/buy.

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Timeline

1969 2007 2007 2008 2011 2016 20162008 2011

Instinet

Founded

Instinet Acquired by

Nomura; Chi-X

Global Founded

Chi-X Europe

Founded

Chi-X Canada

Founded

Chi-X Japan

Founded

Chi-X Australia

Founded

Chi-X Europe

Acquired by

Bats Global Markets

Chi-X Canada

Acquired by

NASDAQ

Chi-X Global

Acquired by J.C.

Flowers; Chi-X Asia

Pacific Founded

2010 2018

Chi-Tech (HK)

Founded

Chi-Tech (PH)

Founded

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Chi-X Structure

Launched in 2010

One of two PTSs viewed as viable alternatives to the TSE

Currently ~2.0% market share

Operates 4 trading books including both lit and dark

Operates a continuous market along with VWAP cross market

Dedicated market operations team, strong local sales and product development teams with deep understanding of domestic broker community

Launched in 2011

An established Securities and Derivatives exchange

Regularly achieves over 20% of Australian market share and $1 billion a day in cash equities

Offers a full suite of services for exchange traded investment products and cash equities including; Trading, Reporting, Risk Management, Market Data, Connectivity

Investments products platform includes Warrants, Indices (CXA 200), TraCRs, or Transferable Custody Receipts (reverse ADRs) and ETFs/QMFs

Chi-X Global Technology (Hong Kong) launched in 2008, Chi-X Global Technology (Philippines) launched in 2018

Five core tech teams based in both the Philippines and Hong Kong

DevelopmentQuality AssuranceSupportService Desk Infrastructure

Builds and supports Chi-X Global proprietary technology solutions as well as custom exchange solutions to key third parties including CFETS

Chi-X Japan

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Chi-X Japan Company Overview

PTS Trading ToSTNeTReportingContinuous Matching Periodic Matching

Chi-Alpha

Main PTS8:00-16:00

Chi-Select

Retail & DMM8:00-16:00

Chi-Match

TSE VWAP CrossingPre-Market Open

Kai-X

Broker NeutralDarkpool

9:00-15:00

Chi-X Japan operates 4 markets, and trades higher volumes and achieves better price

improvement with mid and small-cap equities.

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Chi-X Japan Market Liquidity Trend (June 2019)

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

0

10

20

30

40

50

60

70

JPY b

illion

Average Daily Execution Market Share - All Large Mid Small

Average PI (bps)

MarketShare

Large 0.5 0.7%

Mid 2.7 3.2%

Small 3.9 3.7%

T2/J/M 10.6 1.7%

ETF/REIT 5.4 1.5%

Overall 3.8 2.0%

Large

15%

Mid

51%

Small

23%

T2/J/M

5%

ETF/REIT

6%

Execution Value Breakdown

Market share: Chi-X’s 2 markets among lit markets (TSE, Chi-Alpha, Chi-Select, JNX-J, JNX-X)PI (Price Improvement): it compares the trade price vs. TSE's best bid for sell or best offer for buy at each point of trade and is calculated from the perspective of the Taker of the trade. The average calculation includes trades at TSE price.

Chi-X Australia

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Chi-X Australia Company Overview

Trading

Cash Equities: ~20% Market Share

(Record Day 24.1% November 2017)

ETFs: ~35% Market Share

(Record Day 47% November 2017)

Warrants: ~15% Market Share

(Record Day 16.5% January 2018)

Market Data

Terminals

Data Feeds

Historical

Non-Display

Infrastructure

Market Connectivity

Trading Interfaces

Inter-site Data Centre Links

Listed Products

Warrants

Depository Receipts (TraCRS)

Exchange Traded Funds (ETFs) &

(QMFS)

Indices

Chi-X Australia is a fully licensed securities and derivatives exchange with a reputation for

focus on customers and innovation.

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Chi-X Australia Update: Equities Trading

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Chi-X Australia Investment Products

* Subject to regulatory approval

Warrants

TraCRs*

Indices

Funds**

Chi-X Global Technology

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Chi-X Global Technology (Chi-Tech) Company Overview

Chi-Tech’s Value: Demonstrated reliability and expertise in trading technology, software development, market operations, support, and other advisory for its various exchanges.

• High-performance continuous matching system• Integration of SOR with wholesale equity market platforms• Architect of next generation of execution platform• Development of dark pool

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Chi-X Global Technology (Chi-Tech) at a Glance

Hong Kong / Philippines

(32 & 39 staff, respectively)

Development Quality

AssuranceSupport Service Desk Infrastructure

Our Capabilities:• High Performance Real-time data distribution systems

• High Volume/High Availability/Low-Latency trading systems

• Big Data (Cloudera Hadoop)

• Artificial Intelligence using Machine Learning/Deep Learning

• Cloud Services

• Building and Support of Financial Trading Systems

Chi-Tech has successfully developed and licensed Market Data Systems and Data Enterprise/Integration platforms for

major exchanges like DBAG, Euronext and China Foreign Exchange Trading System (a subsidiary of the PBOC).

Our Languages:• C++, Java, Web, Python, Matlab, R

• DB – MySql, NoSQL, COUCH, Redis