NinjaTrader Group LLC., a leading US futures broker, is set to accelerate South Koreans’ investments in overseas derivatives while seeking to attract foreign investors to revive the ailing derivatives market in Asia’s fourth-largest economy.
NT Korea Co., NinjaTrader’s first subsidiary in Asia, is working on preliminary processes to gain approval from financial authorities for its futures brokerage business in South Korea.
“This initiative aims to provide domestic investors with advanced systems for profit protection and risk management while integrating NinjaTrader’s global standards in management and ICT innovation to enhance market sophistication and competition,” said NT Korea President Yee Chung.
“NT Korea seeks to enable Korean investors to explore advanced overseas derivatives strategies and offer international investors access to the South Korean market.”
Chung seen as a pioneer in the South Korean derivatives market, worked as the derivatives sales head at Samsung Futures Inc. and Deutsche Securities Korea Co. Just before joining NinjaTrader Group, he led the derivatives division at Korea’s SI Investment & Securities from 2021 to 2022. Prior to this, he was the Korea representative for UOB Bullion and Futures under UOB Group from 2013 to 2020, based in Singapore and South Korea.
NT Korea seeks to enable Korean investors to access advanced overseas derivatives strategies while providing international investors with opportunities to engage in the South Korean market.
The company aims to actively promote South Korean derivatives products to global retail investors, foster cooperation with local brokers, and attract foreign capital to drive joint growth.
These efforts are intended to strengthen South Korea’s position as a financial hub in Northeast Asia, contributing to the overall growth and value of the country’s financial industry.
INCREASING INVESTMENTS IN OVERSEAS DERIVATIVES
Locals’ trading volume of overseas derivatives totaled $6.7 trillion in the first nine months of 2024, up 14% from a year earlier, according to data from the Korea Financial Investment Association.
In 2020, the government tightened regulations on domestic derivatives requiring deposits and pre-training for investments in leveraged derivatives and others to protect individual investors. The move spurred local investors, especially risk-takers, to seek investments in other countries.
South Koreans’ trading volume of overseas derivatives increased from $7.8 trillion in 2020 to $8.6 trillion in 2021 and $10 trillion in 2022, respectively.
SHRINKING INVESTMENTS IN DOMESTIC DERIVATIVES
On the other hand, the local derivatives market was declining.
The average daily trading value of the Korea Exchange (KRX) derivatives market fell 4.8% to 58.6 trillion won ($42.6 billion) in 2023 from the previous year, dropping for the second consecutive year, data from the exchange showed.
As the domestic derivatives market is declining and South Korean investors seek overseas opportunities, NinjaTrader’s entry is expected to bridge this gap, supporting growth in both the domestic and international derivatives landscape.
NT Korea plans to actively attract NinjaTrader’s global investors to the domestic market once it receives regulatory approval for its business in line with the KRX’s plan to launch its own night trading platform for exchange-traded derivatives in the first half of 2025 in a move to prop up the local market.
“NinjaTrader Group has a user base of more than 2 million members with the number of new customers increasing 30% every year,” said Chung. ”If we can attract those overseas investors to Korea, the liquidity of the local derivatives market will improve significantly.”
That could boost the overall values of South Korea’s assets, he added.
THE INDUSTRY-LEADING FUTURES BROKER
NinjaTrader is the Leading futures broker on the world’s derivatives marketplace Chicago Mercantile Exchange (CME) by trading volume of retail investors.
NinjaTrader, a fintech platform for futures trading founded in 2003, provides award-winning trading software and brokerage services to active traders.
The firm offers a modern cloud-based futures trading platform now available via desktop, mobile and web applications, enabling customers to trade from any location.
The platform is famous among dedicated futures traders as it offers multiple low-cost pricing options and low-margin rates.
In January 2023, the company announced a custom-built trading tool to support event-based futures.
NinjaTrader platforms are free to use, while there is also simulated trading available without having to fund the account. The platform has excellent, customizable charting and real-time analysis. It also supports trading directly from charts. Further, the platform supports multiple apps and third-party add-ons.
By Jongwoo Cheon
jwcheon@hankyung.com
Edited by Jennifer Nicholson-Breen
