The Safeguards

Clearing Participantship Standard

Participantship standard is the first line of defense in the risk management system. There are two categories of the clearing participantship, namely, Individual/Direct Clearing Participantship and General Clearing Participantship.

For HKCC, Individual Clearing Participants should have minimum liquid capital of HK$5 million and General Clearing Participants should have at least liquid capital of HK$100 million. In addition to the financial requirement, HKCC also considers the other factors including (1) the company background, (2) financial conditions, (3) the experience of the company’s directors and key personnel and (4) the risk management system employed by the company. The clearing participantship is only open to the HKFE Participants.

For SEOCH, Direct Clearing Participants should have minimum liquid capital of HK$5 million and General Clearing Participants should have at least liquid capital of HK$100 million. In addition to the financial requirement, SEOCH also considers the other factors including (1) the company background, (2) financial conditions, (3) the experience of the company’s directors and key personnel and (4) the risk management system employed by the company.

Clearing System

The Derivatives Clearing and Settlement System (DCASS) is an integrated clearing and settlement system for the derivative markets covering futures and options products of HKEX. It is a fully electronic and automated clearing and settlement system capable of supporting many types of derivatives products. It also provides a seamless interface for derivatives trading and clearing, which reduces cost through common hardware, software and communication links. DCASS enables Participants to establish and maintain positions in either the house or the client accounts. Stock transactions as a result of exercise and assignment are settled under the Continuous Net Settlement System (CNS) in Central Clearing and Settlement System (CCASS).

Margining System

Margin requirements are good faith deposits to guarantee the performance of the contracts. Margin levels for all products traded in HKFE are established with reference to historical price volatilities, current and anticipated market conditions, and other relevant information. HKCC and SEOCH calculate the margin requirements of their participants at the end of each trading day using PRiME, (Portfolio Risk Margining System of HKEX), a SPAN[1] compatible margining algorithm that underpins the margining engine of DCASS. PRiME determines the margin requirements based on its assessment of the maximum potential risk exposure of a portfolio over a one-day period under different realistically simulated market scenarios. It takes into consideration of the major risk factors, such as the movement in the prices and volatilities of underlying assets, the time until expiration and the risk-free interest rate when assessing the potential loss (risk) of the portfolio’s value. Margin levels are routinely reviewed and will be revised should market conditions change.

HKCC and SEOCH perform regular backtesting to evaluate the margin coverage and regular sensitivity analysis to test the sensitivity of the margin model coverage. The latest results as of September 2024 reveal that the model performance is satisfactory. The margin coverage for major products and all Clearing Participants' portfolios can achieve single-tailed confidence level of at least 99%.

Daily Mark-To-Market

HKCC reduces its risk through the mark-to-the-market process at the close of Markets each trading day for each contract. All open positions are revaluated daily, on the basis of their respective closing prices and any resulting losses should be settled by Clearing Participants before the opening of Markets on the next day. Collections from Clearing Participants are processed by the Direct Margin Debiting System (“DMDS”) through which HKCC instructs its settlement banks to direct debit the Clearing Participant’s bank account. Money settlement conducted by settlement banks should be confirmed before 9:15 a.m. to assure that all open positions are fully margined before the opening of Markets.

Each day, after the close of trading, SEOCH marks the marginable positions to market with the fixing price of each option series determined by SEOCH. The resulting amount is called Mark-to-Market margin. Collections from Clearing Participants are processed by the Direct Margin Debiting System (“DMDS”) through which SEOCH instructs its settlement banks to direct debit the Clearing Participant’s bank account. Money settlement conducted by settlement banks should be confirmed before 9:15 a.m. to assure that all open positions are fully margined before the opening of Markets.

Mandatory Intra-day Variation Adjustment and Margin Call

Following the market open of T Session on each Trading Day, HKCC conducts a mandatory Intra-day Variation Adjustment and Margin call on all markets on Clearing Participants. The calculation is based on the prevailing open positions and the Calculated Opening Prices (COP) or the prices at the time specified by HKCC from time to time. The mandatory call includes both margin and variation adjustment (i.e. Mark-To-Market) to ensure that all positions, including trades transacted during the preceding T+1 Session, are fully margined and reduce the risk of HKCC from the preceding T+1 Session during which intra-day call is not available. HKCC will collect any shortfall amounts that exceed HK$2 million by DMDS and Clearing Participants will receive notification calls from HKCC on their settlement amounts by 10:00 a.m. All money settlement amounts should be met by Clearing Participants within two hours after the notification, by noon on the same Trading Day or by the prescribed deadline set by the Clearing House.

Intra-day Variation Adjustment / Margin Call

During periods of high market volatility, HKCC conducts intra-day mark-to-the-market calculations on real-time open positions using the prevailing market prices. Clearing Participants who suffer losses as a result of the intra-day calculation will receive a call from the HKCC. All intra-day variation adjustment calls should be met by Clearing Participants within one hour after the notification. On the other hand, if an intra-day mark-to-the-market calculation is made at or before 12:30p.m., Participants will receive payments from the HKCC if they make profits arising from the intra-day calculation. Generally, a margin erosion of 25% in any Market will automatically trigger the intra-day variation adjustment call in that Market and/or any other Market whose underlying instrument is the same as or similar to the underlying instrument of that Market. Apart from the ad-hoc intra-day variation adjustment call which is triggered by market volatility, HKCC conducts a routine intra-day assessment on each HKCC Participant’s Capital Based Position Limits (“CBPL”) after the close of the morning trading session and issues intra-day variation adjustment calls to HKCC Participants who are in breach of their CBPL. With the capacity to conduct intra-day variation adjustment calls, HKCC is not forced to wait until the settlement on the next day and margins for those contracts whose prices have changed significantly can be restored immediately.

During periods of high market volatility, SEOCH conducts intra-day margin call on real-time open positions using the prevailing market prices. All intra-day margin calls should be met by Clearing Participants within one hour after the notification. Generally, a margin erosion of 50% in the margin interval of any one of the option classes automatically triggers the intra-day margin call. With the capacity to conduct intra-day margin calls, SEOCH is not forced to wait until the settlement on the next day and margins for those contracts whose prices have changed significantly can be restored immediately.

Capital Based Position Limit

HKCC assigns gross and net position limits to each Clearing Participant on the basis of its apportioned Liquid Capital (“LC”). It is a measure which seeks to ensure that the risk exposures of participant commensurate with their financial strength in terms of LC. Should an HKCC Participant's total Gross and/or Net position exposure exceed the assigned limits, the Participant can extend the limit by increasing its liquid capital. In addition, during the T+1 session where banking service is not available, HKCC performs monitoring of HKCC Participants’ net CBPL based on the latest market prices and positions on an hourly basis to ensure HKCC Participants’ exposures are within the limits.

SEOCH assigns Gross, Net and Total position limits to each Clearing Participant on the basis of its apportioned Liquid Capital (“LC”). It is a measure which seeks to ensure that the risk exposures of participant commensurate with their financial strength in terms of LC. Should an SEOCH Participant's Gross, Net and/or Total position exposure exceed the assigned limits, the Participant can extend the limit by increasing its liquid capital.

Additional Margin on Concentrated Positions

To minimize the risk arising from the over-concentration of open Futures and Options positions on one Participant, HKCC has the authority to impose additional margins on individual Participants. If the projected aggregate loss (less any Clearing House margin) based on the Reserve Fund stress assumptions arising from such open Futures and Options positions (“Net Projected Loss”) held by a Participant in any product group^{^} is greater than 30% of total Net Projected Loss of all Participants and the total Net Projected Loss of the product group exceeds of HK$500 million, HKCC will increase the margin level by 20% or more^# (depends on its concentration level in that particular product group) on that Participant.

To minimize the risk arising from the over-concentration of open option positions and pending stock positions on one Participant, SEOCH has the authority to impose additional margins on individual Participants. If the projected aggregate loss (less any margin) based on the Reserve Fund stress assumptions arising from such open options positions and pending stock positions (‘Net Projected Loss”) held by a Participant is greater than 30% of total Net Projected Loss of all Participants and the total Net Projected Loss of all Participants exceeds HK$500 million, SEOCH will increase the margin requirement by 20% or more^# (depends on its concentration level) on that Participant.

^{^} List of Product Groups

Product Group	Products
Hang Seng Index (HSI) Futures & Hang Seng China Enterprises Index (HSCEI) Futures Product Group	HSI Futures HSI Options Flexible HSI Options HSI Futures Options Mini-HSI Futures Mini-HSI Options HSCEI Futures HSCEI Options Flexible HSCEI Options HSCEI Futures Options Mini-HSCEI Futures Mini-HSCEI Options Hang Seng Index (Net Total Return Index) Futures Hang Seng China Enterprises Index (Net Total Return Index) Futures Hang Seng Index (Gross Total Return Index) Futures Hang Seng China Enterprises Index (Gross Total Return Index) Futures MSCI Asia ex Japan Net Total Return Index Futures MSCI Taiwan (USD) Index Futures and Options MSCI Taiwan Net Total Return (USD) Index Futures MSCI Japan Net Total Return (USD) Index Futures MSCI Australia Net Total Return (USD) Index Futures MSCI EM Asia Net Total Return (USD) Index Futures MSCI EM EMEA Net Total Return (USD) Index Futures MSCI Hong Kong Net Total Return (USD) Index Futures MSCI Emerging Markets Net Total Return (USD) Index Futures MSCI Emerging Markets (USD) Index Futures MSCI EM ex China Net Total Return (USD) Index Futures MSCI EM ex Korea Net Total Return (USD) Index Futures MSCI EM Asia ex China Net Total Return (USD) Index Futures MSCI EM Asia ex Korea Net Total Return (USD) Index Futures MSCI Pacific Net Total Return (USD) Index Futures MSCI Pacific ex Japan Net Total Return (USD) Index Futures MSCI Taiwan 25/50 (USD) Index Futures MSCI Taiwan 25/50 Net Total Return (USD) Index Futures MSCI China (USD) Index Futures MSCI China Net Total Return (USD) Index Futures Hang Seng TECH Index Futures Hang Seng TECH Index Options Hang Seng TECH Futures Options
CES China 120 Index Futures Product Group	CES China 120 Index Futures
HSI Volatility Index Futures Product Group	HSI Volatility Index Futures
HSI Dividend Point Index Futures Product Group	HSI Dividend Point Index Futures
HSCEI Dividend Point Index Futures Product Group	HSCEI Dividend Point Index Futures
Hang Seng Mainland Banks Index Futures Product Group	Hang Seng Mainland Banks Index Futures
London Aluminium Mini Futures Product Group	CNH London Aluminium Mini Futures USD London Aluminium Mini Futures
London Copper Mini Futures Product Group	CNH London CopperMini Futures USD London CopperMini Futures
London Zinc Mini Futures Product Group	CNH London ZincMini Futures USD London ZincMini Futures
London Nickel Mini Futures Product Group	CNH London NickelMini Futures USD London NickelMini Futures
London Tin Mini Futures Product Group	CNH London TinMini Futures USD London TinMini Futures
London Lead Mini Futures Product Group	CNH London LeadMini Futures USD London LeadMini Futures
One-Month Hong Kong Interbank Offered Rate (HIBOR) Futures Product Group	One-month HIBOR Futures
Three-Month HIBOR Futures Product Group	Three-Month HIBOR Futures
Individual Hong Kong Stock Futures Product Group	Individual Hong Kong Stock Futures
US Dollar vs Renminbi (Hong Kong) Currency Futures Product Group	US Dollar vs Renminbi (Hong Kong)(“USD/CNH”) Futures US Dollar vs Renminbi (Hong Kong)(“USD/CNH”) Options Renminbi (Hong Kong) vs US Dollars (“CNH/USD”) Futures Mini US Dollar vs Renminbi (Hong Kong)("USD/CNH") Futures
Australian Dollars vs Renminbi (Hong Kong)(“AUD/CNH”) Futures Product Group	Australian Dollars vs Renminbi (Hong Kong)(“AUD/CNH”) Futures
Euro vs Renminbi (Hong Kong)(“Euro/CNH”) Futures Product Group	Euro vs Renminbi (Hong Kong)(“Euro/CNH”) Futures
Indian Rupee vs Renminbi (Hong Kong)(“INR/CNH”) Futures Product Group	Indian Rupee vs Renminbi (Hong Kong)(“INR/CNH”) Futures
Indian Rupee vs US Dollar Futures Product Group	Indian Rupee vs US Dollar (“INR/USD”) Futures
Japanese Yen vs Renminbi (Hong Kong)(“JPY/CNH”) Futures Product Group	Japanese Yen vs Renminbi (Hong Kong)(“JPY/CNH”) Futures
USD and CNH Gold Futures Product Group	USD Gold Futures CNH Gold Futures
USD and CNH Silver Futures Product Group	USD Silver Futures CNH Silver Futures
Iron Ore Futures Product Group	TSI Iron Ore Fines 62% Fe CFR China Futures Monthly Contracts TSI Iron Ore Fines 62% Fe CFR China Futures Quarterly Contracts
MSCI New Zealand NTR (USD) Futures Product Group	MSCI New Zealand Net Total Return (USD) Index Futures
MSCI Thailand NTR (USD) and Thailand (USD) Futures Product Group	MSCI Thailand Net Total Return (USD) Index Futures MSCI Thailand (USD) Index Futures
MSCI Indonesia NTR (USD) and Indonesia (USD) Futures Product Group	MSCI Indonesia Net Total Return (USD) Index Futures MSCI Indonesia (USD) Index Futures
MSCI Malaysia NTR (USD) and Malaysia (USD) Futures Product Group	MSCI Malaysia Net Total Return (USD) Index Futures MSCI Malaysia (USD) Index Futures
MSCI Vietnam NTR (USD) and Vietnam (USD) Futures Product Group	MSCI Vietnam Net Total Return (USD) Index Futures MSCI Vietnam (USD) Index Futures
MSCI Philippines NTR (USD) and Philippines (USD) Futures Product Group	MSCI Philippines Net Total Return (USD) Index Futures MSCI Philippines (USD) Index Futures
MSCI EM LatAm NTR (USD) Futures Product Group	MSCI EM LatAm Net Total Return (USD) Index Futures
MSCI China A 50 Connect (USD) Index Futures Product Group	MSCI China A 50 Connect (USD) Index Futures
MSCI India NTR (USD) and India (USD) Futures Product Group	MSCI India (USD) Index Futures MSCI India Net Total Return (USD) Index Futures
MSCI Singapore Free Net Total Return (USD) and Singapore Net Total Return (USD) Futures Product Group	MSCI Singapore Free Net Total Return (USD) Index MSCI Singapore Net Total Return (USD) Index MSCI Singapore Free (SGD) Index

^#Tiered Margin Rate

A CP’s Market Share of Net Projected Loss	Additional Margin Rate
Above 30% and at or below 40%	20%
Above 40% and at or below 50%	25%
Above 50% and at or below 60%	30%
Above 60% and at or below 80%	40%
Above 80%	50%^##

^## Applicable on the sixth consecutive Business Days and onwards, before which 40% would be applied, to allow 5 days for CPs to transfer or close out concentrated positions and/or arrange funding.

Holiday Margin Arrangement

HKCC makes a mandatory intra-day variation adjustment call on participants on the trading day prior to the holiday period to mitigate the potential market risk on the reopening of the Hong Kong markets after the holiday break arising from significant overseas market movements during the holiday period. HKCC also raises the margin levels for some major products based on the number of calendar days, excluding Saturdays and Sundays, in the holiday period and the historical price movements and collects the margin requirements of open positions based on such increased margin levels from the participants before the holiday.

SEOCH makes a mandatory intra-day margin call on participants on the trading day prior to the holiday period to mitigate the potential market risk on the reopening of the Hong Kong markets after the holiday break arising from significant overseas market movements during the holiday period. When there are more than one calendar day, excluding Saturdays and Sundays, in the Hong Kong holiday period, SEOCH also raises the margin intervals for each of the option classes based on the number of calendar days, excluding Saturdays and Sundays, in the holiday period and the historical price movements and collects the margin requirements of open positions based on such increased margin intervals from the participants before the holiday.

Reserve Fund

HKCC has established a Reserve Fund for the purpose of meeting its obligations as the counterparty in circumstances that the losses arising from one or more Clearing Participants’ default cannot be fully covered by the defaulting Participant’s margin. The resources available to the Reserve Fund comprise HKCC Participant’s Deposits, HKCC Participant Additional Deposits (HPAD), interest income of the Reserve Fund, Clearing House's resources appropriated as contributions to the Reserve Fund (equivalent to 10% of Reserve Fund size) and other resources as arranged by HKCC from time to time.

The adequacy of the Reserve Fund is assessed on a daily basis by conducting stress testing and HKCC will require participants to pay such amounts by way of HPAD for the purpose of providing further additional resources to the Reserve Fund. Generally, each HKCC Participant is allowed a HKD1 million HKCC Participant Additional Deposits Credit in arriving at its required HPAD.

A threshold is imposed on the Reserve Fund. If the Reserve Fund threshold is reached, Reserve Fund additional margin in the amount of net projected loss of the CP group in excess of 50% of the Reserve Fund threshold will be collected from the CPs of the concerned CP group.

Reserve Fund Threshold: HKD7.3 billion (effective 1 June 2018).

Key stress testing assumptions are:

Price movement assumptions: ±20% applied to key markets* including HSI futures and options and HSCEI futures and options

*The price movement assumptions for HKCC products:

(a) Equity products: ±6% to ±56%

(b) Currency products: ±4% to ±9%

(c) Interest Rate products: ±30%

(d) Metal products: ±12% to ±25%

Implied volatilities assumptions: -24% to +43% applied to options contracts key markets* including HSI options and HSCEI options

*The implied volatilities movement assumptions for HKCC products:

(a) Equity products: -35% to +91%

(b) Currency products: -22% to +38%

Counterparty default assumptions: default of the largest CP Group plus the second largest CP Group

Level of HPAD required = (Projected Loss from stress testing – Defaulting CP Groups’ Margin and collateral**) x1.15 – Basic Elements of Reserve Fund*** – Clearing House’s resources appropriated as contributions to the Reserve Fund

** Collateral includes clearing house margin. Offset of stressed losses and stressed gains not allowed between CPs within a CP Group

*** Denotes the existing aggregate value of the Reserve Fund less the total HPAD and Clearing House’s resources appropriated as contributions to the Reserve Fund

HKCC will re-calculate the requirements for HPAD of each Participant on the 1^st trading day which is also a Business Day of every month and ad hoc recalculation may be made from time to time.

HKCC Participants will be required to pay HPAD under either of the following conditions:

Under the regular monthly assessment where the existing contributions amount is lower than the required contributions; or
Daily risk exposure exceeds 90% of the sum of the existing aggregate value of the Reserve Fund and the aggregate HKCC Participant Additional Deposits Credits utilized by all Clearing Participants for one trading day.

Upon the implementation of Derivatives Holiday Trading, if the 1^st trading day of the month is a Holiday Trading Day or ad hoc recalculation is triggered on a Holiday Trading Day, HKCC will re-calculate the Reserve Fund based on the latest positions and the requirements for HPAD of each Participant and notify Clearing Participants on the 1^st Hong Kong business day immediately after the Holiday Trading Day.

If HPAD is required, HKCC will calculate each Participant’s contribution requirement based on each Participant’s daily average net margin liabilities over the most recent 60 trading days. Each HKCC Participant is allowed a HKD1 million HKCC Participant Additional Deposits Credit in arriving at its required HPAD. Any HPAD payable by an HKCC Participant will be debited from its House CCMS Collateral Account via the Direct Margin Debiting System by 4:00 p.m. of the 1^st trading day which is also a business day after the recalculation, unless otherwise specified by the Clearing House.

HPAD may be contributed in the form of non-cash collateral such as Exchange Fund Bills and Notes provided prior approval is obtained from the Clearing House.

For more details, please refer to Chapter VII - The Reserve Fund of the Rules of HKCC and Chapter 4 – Reserve Fund Contribution of the Clearing House Procedures of HKCC.

SEOCH has established a Reserve Fund for the purpose of meeting its obligations as the counterparty in circumstances that the losses arising from one or more Clearing Participants’ default cannot be fully covered by the defaulting Participant’s margin. The resources available to the Reserve Fund comprise Initial Contribution and Variable Contributions made by Participants, interest income of the Reserve Fund, Clearing House’s resources appropriated as contributions to the Reserve Fund (equivalent to 10% of Reserve Fund size) and other resources as arranged by SEOCH from time to time.

The size of the Reserve Fund is monitored on a daily basis by stress testing and the Clearing House shall require Participants to pay such amounts by way of Variable Contributions for the purpose of providing further additional resources to the Reserve Fund.

A threshold is imposed on the Reserve Fund. If the Reserve Fund threshold is reached, Reserve Fund additional margin in the amount of net projected loss of the CP in excess of 50% of the Reserve Fund threshold will be collected from the concerned CPs.

Reserve Fund Threshold: HKD2.7 billion (effective 1 June 2018).

Key stress testing assumptions are:

Market movement assumptions: -29% to +42%
Implied volatilities assumptions: -80% to +142%
Counterparty default assumptions: default of the single largest Participant plus the fifth largest Participant

Level of Variable Contributions required = (Projected Loss from stress testing – Defaulting participants’ Margin and collateral*) x1.15 – Basic Elements of the Reserve Fund** – Clearing House’s resources appropriated as contributions to the Reserve Fund

* Collateral includes mark-to-market margin and risk margin

** Denotes the Initial Contributions, interest income, any guarantee, facility and insurance policy

SEOCH will re-calculate the Variable Contributions of each Participant on the 1^st business day of every month and ad hoc recalculation may be made from time to time.

SEOCH Participants will be required to pay Variable Contributions under either of the following conditions:

Under the regular monthly assessment where the actual Variable Contributions on hand is lower than the required level; or
Daily risk exposure exceeds 90% of the existing Reserve Fund size for one business day

If Variable Contributions are required, each Participant's share of the Variable Contribution will be equal to that Participant's share of the average total margin requirement and net premium paid over the most recent 60 business days. Any Variable Contributions payable by SEOCH Participant will be debited from its House CCMS Collateral Account via the Direct Margin Debiting System by 4:00 p.m. of the 1^st business day after the recalculation, unless otherwise specified by the Clearing House.

Variable Contributions may be made in the form of non-cash collateral such as Exchange Fund Bills and Notes provided prior approval is obtained from the Clearing House.

For more details, please refer to Chapter 4 – SEOCH Participant’s Obligation of the Options Clearing Rules of SEOCH and Chapter 11 – Reserve Fund of the Operational Procedures for Options Trading Exchange Participants of SEOCH.

Collateral Management

Participants' margin deposits must be in the form of cash, Exchange Fund Bills/Notes, US Treasury Bills/Notes or other acceptable collateral types as prescribed from time to time. If a participant does not have sufficient margin collateral on deposit with HKCC/SEOCH to satisfy the margin requirements calculated, a direct debit instruction will be sent to the participant's designated bank to collect the shortfall. All margin calls must be met before the stipulated time.

Segregation of Customer Monies

Participants are also required to separate their customer positions and monies from their own positions. The regulations are designed to protect customers in the event of the insolvency of financial instability of the HKCC/SEOCH Participant through which they conduct business. Based on specific written instructions from a HKCC/SEOCH Participant, HKCC and SEOCH maintain separate accounting of the aggregate positions and monies of the HKCC and SEOCH Participant's customers.

Participant's Default

While the risk management techniques at HKCC and SEOCH are specifically designed to prevent an HKCC/SEOCH Participant from defaulting on its obligations, the Clearing House, by rule and by operational practice, has prepared contingencies to deal with such an event. The following summarizes the steps that would be taken in the event an HKCC/SEOCH Participant failed to meet its financial obligations to HKCC/SEOCH.

The HKCC managed Reserve Fund provides instant liquidity to the market in the event that the HKCC Participant cannot meet margin calls and his margin monies have been exhausted. When an HKCC Participant defaults, customer positions are netted against each other and the HKCC Participant's margin money is applied to any deficits after netting. If the deficit exceeds funds available in the HKCC Participant's margin deposits, the balance will be applied from the Reserve Fund in layers. Under no circumstances will customer segregated margin deposits held by the Clearing House for one HKCC Participant be used to cover either a house or customer default of another HKCC Participant. Customers doing business through an HKCC Participant not involved in a default are insulated from losses incurred by the failure of another HKCC Participant.

The SEOCH managed Reserve Fund provides instant liquidity to the market in the event that the SEOCH Participant cannot meet margin calls and his margin monies have been exhausted. When an SEOCH Participant defaults, customer positions are netted against each other and the SEOCH Participant's margin money is applied to any deficits after netting. If the deficit exceeds funds available in the SEOCH Participant's margin deposits, the balance is withdrawn from the Reserve Fund in layers. Under no circumstances will customer segregated margin deposits held by the Clearing House for one SEOCH Participant be used to cover either a house or customer default of another SEOCH Participant.

The safeguard system of the HKCC and SEOCH provides a unique blend of risk management and financial surveillance techniques designed for the protection of the Clearing Participants and its customers. As the Clearing House strives to become more responsive to the demands of a sophisticated financial marketplace, it will continue to improve and strengthen its financial safeguard system. This article has been compiled by the HKCC and SEOCH for general information purposes only. Although every attempt has been made to ensure the accuracy of the information, the HKCC and SEOCH assume no responsibility for any error or omission. All matters pertaining to rules and procedures herein are made subject to and are superseded by the official HKCC and SEOCH rules and procedures.

Holiday Trading arrangement

The above risk management arrangements also apply to Hong Kong public holidays which trading and clearing are available. All HKCC Holiday Trading Clearing Participants are required to settle all payment obligations arising from holiday trading. HKCC non-Holiday Trading Clearing Participants are not required to fulfil any payment obligations during Holiday Trading Days and any outstanding payment obligations will be settled on the 1^st Hong Kong business day immediately after the Holiday Trading Day.

[1] SPAN (Standard Portfolio Analysis of Risk) is a registered trademark of the Chicago Mercantile Exchange

Updated 15 Nov 2024