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HKEX Launches MSCI China A 50 Connect Index Futures

Corporate
Products
18 Oct 2021

  • HKEX’s MSCI China A 50 Connect Index Futures starts trading today
  • Launch marks major milestone in strengthening Hong Kong’s role as gateway to China for global investors
  • Competitive and attractive new product launches with fee waiver on trading until June 2022

 

Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to welcome today (Monday) the launch of its new A-share derivatives contract, the MSCI China A 50 Connect Index Futures. This represents a significant step in the further expansion of HKEX’s derivatives product suite and reinforces HKEX’s role as the go-to marketplace for China trading and investments.

HKEX is now home to the world’s most complete and competitive offshore A-share equity and derivatives trading venue, offering global investors and risk managers a convenient and cost-effective solution to trade and manage their China exposure.

HKEX Chief Executive Officer Nicolas Aguzin said: “We are very excited to today launch our MSCI China A 50 Connect Index Futures, confirming Hong Kong as the global international go-to market for accessing China. This new product further strengthens Hong Kong’s role as the gateway to China for global investors and marks another great step forward in supporting the further internationalisation of China’s capital markets.”

The new futures contract is unique, as it is based on the MSCI China A 50 Connect Index, a sector-balanced index that selects 50 names from among the largest stocks listed in Shanghai and Shenzhen available via Stock Connect, and targets at least two stocks from each sector. This can prevent overweighting in specific sectors such as financials and underweighting in new economy sectors, providing investors with a risk management tool that truly represents China’s economy.  

“China connectivity is Hong Kong’s unique advantage, setting us apart from other international financial centres around the world. We look forward to continuing to develop Hong Kong’s leading position as Asia’s derivatives hub,” said Mr Aguzin.  

The new contract provides international investors with a new and effective risk management tool to manage their portfolios of Stock Connect eligible A-shares, reflecting the increasing global reliance on Stock Connect to access Mainland China’s burgeoning equity markets.

Since its launch in 2014, Stock Connect has become the key channel for international investors to access Mainland China’s equities market and has helped facilitate the opening up of the A-share market. 

Stock Connect’s trading volumes saw record half-yearly highs in 2021, with average daily turnover of Northbound and Southbound trading up 54 per cent to RMB114 billion and 132 per cent to $48 billion respectively.

The new contract has been certified by the US Commodity Futures Trading Commission to be offered and sold to persons in US, and US investors can trade the new contracts at launch.

To further support the development of the contract, HKEX is also offering a trading fee holiday until June 2022.  

Details of the MSCI China A 50 Connect Futures are available on HKEX webpages below:

HKEX Derivatives Information for Overseas Investors 

MSCI China A 50 Connect Index Futures

 

C72_0426

(from left to right) SFC Executive Director, Supervision of Markets Division, Rico Leung, MSCI APAC Head of Index Products Doug Walls, HKEX Chief Executive Officer Nicolas Aguzin and Chairman Laura M Cha attending the market open ceremony to mark the commencement of trading of HKEX’s MSCI China A 50 Connect Index Futures.

 

About HKEX

Hong Kong Exchanges and Clearing Limited (HKEX) is one of the world’s major exchange groups, and operates a range of equity, commodity, fixed income and currency markets.  HKEX is the world’s leading IPO market and as Hong Kong’s only securities and derivatives exchange and sole operator of its clearing houses, it is uniquely placed to offer regional and international investors access to Asia’s most vibrant markets.

HKEX is also the global leader in metals trading, through its wholly owned subsidiaries, The London Metal Exchange (LME) and LME Clear Limited.  This commodity franchise was further enhanced with the launch of Qianhai Mercantile Exchange (QME), in China, in 2018.

HKEX launched the pioneering Shanghai-Hong Kong Stock Connect programme in 2014, further expanded with the launch of Shenzhen Connect in 2016, and the launch of Bond Connect in 2017.

www.hkexgroup.com

 

Ends

Updated 28 Oct 2021