April 6, 2020 / 1:50 AM / 3 months ago

Amid wild swings, Australian stock market trade volume doubles in March - ASX

* Value of stock in March A$264 bln vs A$126 bln a year ago

* Index options trade surges

* March worst month for Aussie benchmark since 1987

SINGAPORE, April 6 (Reuters) - The volume and value of trades on the Australian Securities Exchange doubled during last month’s wild market swings, the exchange operator said on Monday.

Australia’s stock market posted its worst month since 1987 in March, plunging 21.5% amid a worldwide equities rout as the coronavirus pandemic worsened.

The volume of trades more than doubled to 67.5 million compared with March 2019, and the average daily trade rose 96% to 3 million, according to monthly statistics released by exchange operator ASX Ltd.

The total value of cash market trades rose 110% to A$264.2 billion ($159.3 billion) compared with A$125.5 billion a year earlier. There was also a 51% surge in index options, as fund managers used them to offset big swings in their portfolios.

“The market volatility was sky high,” said Mathan Somasundaram, strategist at brokerage Blue Ocean Equities in Sydney. “Thematics were changing on a weekly basis.”

“It’s too hard to move big portfolios, but easier to do that with index options. The big volumes in index options forced the option providers to then have to trade big on equities to counter the risk. Hence we had elevated equities volume driven by elevated index options,” he said.

The benchmark index posted both its second-largest daily drop and its biggest daily rise in the month, and on the All-Ordinaries index, average daily movement was 4.1% compared with 0.3% in March 2019.

$1 = 1.6584 Australian dollars Reporting by Tom Westbrook; Editing by Arun Koyyur

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