The Australian Securities and Investments Commission (ASIC) is to adopt technology developed by Finance Professor Mike Aitken at UNSW's Australian School of Business.
The Integrated Market Surveillance System can find evidence of insider trading, market manipulation and continuous disclosure breaches. The computer software will begin real time monitoring of trading for ASIC in the third quarter of this year.
"The system looks for advanced knowledge of a company announcement, by detecting unusual price or volume movements, prior to information being published," explains Professor Aitken.
"This provides prima facie evidence of insider trading. If no information has been published, price rises may be a case of market manipulation."
The system will be implemented by SMARTS, the company founded by Professor Aitken. He is also chief scientist of the Capital Markets Cooperative Research Centre (CMCRC), which brings together the disciplines of finance, accounting, securities law and computer science.
CMCRC has created strong links between academic research and business. There are currently 55 PhD students from the School developing the technology to maximise its effectiveness within commercial clients.
SMARTS has been recognised as one of Australia's leading exporters. The technology will now operate at the Australian Securities Exchange, as well as at over 40 global exchanges and regulators including the London Stock Exchange, HK Exchanges, and the Swiss Exchange.
Read the full story at the ASB newsroom.
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