Presentation on theme: "FTSE/Xinhua China 25 Index (FXI China 25) Futures & Options Launch Date: 23rd May 2005."— Presentation transcript:
FTSE/Xinhua China 25 Index (FXI China 25) Futures & Options Launch Date: 23rd May 2005
2 HKEx Corporate Mission The mission of HKEx is to operate a world-class marketplace for Hong Kong and Mainland China securities and derivatives products.
3 HKEx – The Largest International Capital Formation & Trading Centre for Mainland Enterprises For the year 2004Market total Mainland Enterprises Total As % of total market Listed companies (As at end of Dec 2004) 1, % Number of New Listings704463% Market capitalisation (As at end of Dec 2004) HK$6,965 billion HK$2,020 billion 30.2% Funds raised by IPOsHK$97.5 billion HK$76.4 billion 78.9% Average daily turnoverHK$13.7 billion HK$6.7 billion 49%
4 HKEx – The Trading Centre for Mainland Enterprise Derivatives H-shares Index Futures H-shares Index Options 16 Stock Options / Futures on Mainland enterprises: 6 on individual H-shares 10 on individual Red-chips FXI China 25 Futures & Options
5 Why FXI China 25 Index Futures & Options? To expand product offerings to meet market demand for derivatives products on Mainland enterprises listed in Hong Kong To complement H-shares index futures and options trading
6 Why FXI China 25 is chosen for trading? Broad-based index covering both H-shares and Red-chips suitable for derivatives trading, hedging and arbitrage Constituent stocks restricted to 25 most liquid shares of Mainland enterprises listed in Hong Kong The weighting of each constituent stock is capped to maintain a balanced composition – meets regulatory requirements Widely recognised by OTC structured products issuers with US$3 billion of OTC products referenced to FXI China 25
7 FXI China 25 Index Performance vs. HSI FXI China 25 has out-performed the Hang Seng Index (from Jan 2003 to Mar 2005)
8 FXI China 25 Index 20-Days Annualised Volatility vs. HSI FXI China 25 has higher volatility than the Hang Seng Index (from Jan 2003 to Mar 2005)
9 FXI China 25 Summary Statistics Index Level* : 8, Investible Market Cap*:HK$ billion Average Daily Turnover # :HK$4.31 billion of constituent stocks in HK 20-day Annualised* :15% (vs. HSI 11%) Historical Volatility Index Return # :85.4% (vs. HSI 57.2%) * As of 31 Mar 2005 # from 1 Apr 2003 to 31 Mar 2005
10 FXI China 25 Index Top 10 Constituents TickerCompany Name Type Weighting* 941China Mobile Red-chip 9.99% 857PetroChina H-share 9.05% 2388BOC Hong Kong (Holdings) Red-chip 8.12% 386China Petroleum & Chemical H-share 6.88% 883CNOOC Red-chip 5.93% 267CITIC Pacific Red-chip 4.05% 2628China Life Insurance H-share 4.05% 2318Ping An Insurance H-share 4.01% 1199COSCO Pacific Red-chip 4.01% 902Huaneng Power International H-share 3.99% *weighting as of 18 April 2005
11 FXI China 25 Index Futures Summary Trading Symbol : FXC Contract Multiplier :HK$50 Contract Value is around* : HK$412,742 (vs. HK$675,844 for Hang Seng Index Futures and HK$239,639 for H-shares Index Futures) Minimum Fluctuation :1 index point Contract Months :Spot, the next calendar month, and the next two calendar quarter months Exchange Fee : HK$5.00 Settlement Fee :HK$5.00 Commission : Negotiable *contracted value based on 31 Mar 2005 closing
12 Features of FXI China 25 Futures and Options Fully Automated Trading & Integrated Clearing Low Transaction Costs PRiME Margining System Hedging Vehicle Arbitrage Opportunities Spread Trading with H-shares Products Dynamic Options Strategies
13 Waiver and Exemption Exchange Fee $5.00 / contract: SFC Levy $1.00 / contract: 3 -month Waiver after launch ! 3 -month Waiver after launch ! 6 -month Exemption after launch ! 6 -month Exemption after launch !
14 Joint Promotion Programmes Index Promotion Program sponsored by FXI - Index guessing games - Radio broadcast of FXI China 25 Index Investment Event on 21 May 2005 to be sponsored by HKEx, sponsoring Exchange Participants and others - Exhibitions and seminars (covering 1,200 people)
15 Education & Communication Programme HKEx will conduct the following education programme -Continuous Professional Training courses for practitioners -Briefings for Exchange Participants -Seminars for professional bodies -Public seminars for investing public