The government ban on any competition to HKEX means that their net profit margin was 61% last year.
As activist investor David Web put it:
"On top of that, HKEX doesn’t even do its job well as an exchange, because it has been exempted from the Competition Ordinance and has fees, profit margins and archaic practices that only a monopoly could get away with."[2]
>Exchanges don't do clearing
True, but this is HKEX, which stands for Hong Kong Exchanges and Clearing. They operate 4 clearing houses in HK.
update: 61% was first 9-months. Fully year was 58%[1]
[1] https://www.hkex.com.hk/-/media/HKEX-Market/News/News-Releas...
You just described Google, and they seem to have plenty of cash in the bank.
If there exists a business whose product is “scalable real-time order-book matching software” as licensed software or SaaS, I’d love to know about it! I’m in an adjacent space, and I’d love to strike up a partnership with such folks.
As far as I know, such a business doesn’t exist; all the big exchanges maintain their own core IP, much like all the big telcos in the 90s maintained their own core telecom-equipment IP. From what I know of the space, each player thinks that licensing the IP would just be either inviting a new player to the table, or more likely inviting enough new players to the table that other parts of the trading value chain would start to see value in abstracting-away and commoditizing their part of it.