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HKEX Head Eyes A-Share Derivative Debut in Hong Kong This Year

HKEX Head Eyes A-Share Derivative Debut in Hong Kong This Year

Xu Wei

Date: Tue, 01/16/2018 - 20:03 / source:Yicai
HKEX Head Eyes A-Share Derivative Debut in Hong Kong This Year
HKEX Head Eyes A-Share Derivative Debut in Hong Kong This Year

(Yicai Global) Jan. 16 -- China’s A-share derivatives are most likely to list on the Hong Kong Stock Exchange this year, but two conditions must first eventuate, said Charles Li, president of the exchange, at the Asian Financial Forum.
These prerequisites are that China Securities Regulatory Commission and Hong Kong’s Securities and Futures Commission must reach a consensus on the matter, and the A-share futures market must be relatively active, Li believes.
A memorandum for cooperation on administration of futures inked between the securities and futures regulators of the mainland and Hong Kong at the end of last year referenced regulatory cooperation and law enforcement cooperation between them in cross-border derivatives, futures exchanges, futures business institutions and employees.
Most A-share derivative deals still occur in the mainland, so they, including A-share futures, still need further market adjustment to revive after China’s 2015 market downturn triggered tightened regulation. Only thus will it be possible to introduce A-share derivatives to the Hong Kong Stock Exchange. Market demand for a Hong Kong debut of A-share derivatives is strong after the inclusion of A-shares in the MSCI emerging markets index this year, and thus conditions are already ripe, Li reckons.

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Keywords: Hong Kong Stock Exchange, A share, Derivatives