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HKEX Confirms Date for After-Hours Trading of Equity Index Options and Outlines New Trading Halt Feature for Options Trading in T+1 Session

Market Operations
17 Apr 2018

  • HKEX’s three most actively traded equity index options (HSI, HSCEI and Mini-HSI options) to be included in derivatives market’s after-hours trading (5:15 pm to 1 am) from 14 May 2018
  • First options to be available for after-hours trading
  • New Trading Halt Mechanism to be introduced to after-hours trading for above options products as part of measures to maintain market integrity

 

Hong Kong Exchanges and Clearing Limited (HKEX) announced today (Tuesday) that market readiness has been confirmed and regulatory approval has been obtained to make its most actively traded equity index options - Hang Seng Index (HSI) Options, Hang Seng China Enterprises Index Options (HSCEI) Options and Mini-HSI Options - available for trading in the after-hours trading (T+1 Session) of its derivatives (futures and options) market from Monday, 14 May 2018. As in the T+1 trading of equity index futures, T+1 trading of the equity index options will begin at 5:15 pm and end at 1 am. 

For market protection in the T+1 Session, a Trading Halt Mechanism (THM) is introduced to avoid potential extreme options price movement in the T+1 Session as outlined below.

  • THM applies only to equity index options trading in the T+1 Session.
     
  • THM of options is linked to trading of the corresponding futures’ spot month contract1.
     
  • THM will be triggered if either:
  1. the highest bid in the buying queue for the corresponding futures’ spot month contract reaches its upper price limit, which is 105 per cent of the futures’ last traded price in the regular trading session (9:15 am to noon; 1 pm to 4:15 pm)2; or
     
  2. the lowest ask in selling queue for the corresponding futures’ spot month contract reaches its lower price limit, which is 95 per cent of the futures’ last traded price in the regular trading session2.
  • If the THM is triggered, trading of the options is halted for the rest of the T+1 Session and will resume in the following regular trading session. A market message will be sent to all brokers and information vendors through the general distribution channels.

For further details of the THM and additional information about the T+1 session, please refer to After-Hours Trading section on the HKEX website.

 

 

 
1  Current Price Limit Up/Down Mechanism” bars sell orders with a price below 95 per cent of the contract’s last traded price in the regular trading session and buy orders with a price above 105 per cent. 
2  The THM will not be triggered if the spot month futures’ price reaches its upper/ lower limit but the highest bid in the buying queue/lowest ask in the selling queue does not. 

 

 

Ends

 

 

Updated 06 May 2020