To cooperate with the listing of corn options and help business personnel of member entities better understand relevant rules of corn options, Dalian Commodity Exchange (DCE) has organized 4 sessions of corn options training in Dalian, Beijing, Shanghai and Guangzhou respectively for a total of over 500 trainees, raising a country-wide heat of learning corn options and being well received among market participants. On January 16, DCE organized the last training on corn options in Hangzhou and about 100 persons, including relevant heads and business personnel from member entities, risk subsidiaries, industry enterprises and investment institutions, took part in the training.
A DCE officer said that the launching of corn options will provide industry chain participants with a direct and effective instrument to avoid price fluctuation risks and form a hedging strategy together with corn futures, which will satisfy enterprises’ different hedging and risk-avoiding demand through different strategy combination. In addition, investors can reduce the premium for hedging by buying or selling put or call options, thus forming the “insurance with no fees”.
Hangzhou is a leading futures city in China, and its over-the-counter options, futures-spot cross-market combination, basis trading and other over-the-counter businesses are relatively mature. The launching of corn options will provide new space for industry service providers like risk subsidiaries. Trainees from risk subsidiaries said that the “insurance + futures” pilot project and the over-the-counter options pilot project for corn have kept expanding and achieved good economic results and social benefits under the support of DCE. The listing of corn options will provide the market with a basic hedging instrument at lower cost and of high efficiency. Risk subsidiaries can directly make use of floor options to hedge against risks, reduce the hedging cost of the “insurance + futures” pilot project and the over-the-counter options, as well as construct a more diversified risk management combination by using the floor options, in a bid to satisfy the real economy’s differentiated and diversified risk management demands and allow risk subsidiaries to better serve the real economy.
