Stock Exchange and Clearstream in cross-border funds deal

The Stock Exchange of Thailand is forging stronger global trading links through an agreement signed last week between the Exchange and Clearstream Banking, a securities depository whose platform enables international investors to access Thai funds.

“The new link allows international investors to access Thailand’s funds market, and Thai investors to access more than 190,000 funds on Clearstream’s platform,’’ according to the website.

Thailand’s mutual fund market had total assets under management of about $131.6 billion at the end of August. The SET is the largest exchange by capitalization in Southeast Asia after the Singapore Exchange. Aside from mutual funds, the SET’s market capitalization is over $560 billion.

The agreement is expected to help raise the SET’s capitalization by making it easier for investors overseas to access mutual funds in the market. Meanwhile, with Thailand’s currency gaining strength, Thai investors are also seeking to purchase funds and other assets beyond the borders of the Kingdom.

The SET’s mutual fund platform FundConnext will now link to Clearstream’s global fund processing platform Vestima. That will give international investors to access Thailand’s funds market, while through Vestima, Thai investors can choose among more than 190,000 investment funds from nearly 50 jurisdictions worldwide.

“The linkage enhances fully automated capabilities for cross-border investment fund distribution between Thailand and the world,” said SET President Pakorn Peetathawatchai.

“Adding order routing, asset servicing, and settlement services for Thai domestic investment funds to our portfolio perfectly fits our Asia funds strategy,” said Bernard Tancré of Clearstream, which has headquarters in Luxembourg, and is part of the Deutsche Borse Group.

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