UBS's mainland venture plans to offer more computerised trading services as it bets on a surge in demand from institutional money managers in the biggest emerging market. Stock trading volumes from institutional investors will more than double within five years, spurred by regulators' efforts to reduce market volatility and reform capital markets, Qu Hongjie, an executive director of China equities at UBS Securities, a venture of Switzerland's largest lender, said in Shanghai last week. "We foresee in the next three to five years institutional trading flows will increase from the current 20 per cent to over 50 per cent," Qu said. "As institutional investors have higher demands for better execution services, more powerful and sophisticated electronic trading platforms will become a key factor for brokerage firms to win market share." The central government is targeting more capital from large domestic and foreign investors to revive a stock market that has been among the world's worst performers. The Shanghai Composite Index has fallen 36 per cent since the start of 2010. The mainland almost doubled investment quotas for the qualified foreign institutional investors scheme to US$150 billion in July. Institutional investors accounted for 60 to 70 per cent of trading volumes in developed markets, Qu said, but only about 20 per cent on the mainland. Beijing would continue expanding the types of contracts traded on local exchanges, Qu said. The China Financial Futures Exchange started mock trading of options on CSI 300 stock-index contracts last Friday, saying they will improve price discovery and market efficiency. Some local brokers were also testing the use of stock options with the exchange that would allow investors to hedge their holdings in specific firms, Qu said.