HKEx Announces Market Makers And Margin Rates For A-share ETF Futures

Hong Kong Exchanges and Clearing Limited (HKEx) has obtained the Securities and Futures Commission’s approval to launch China AMC CSI 300 index ETF, CSOP FTSE China A50 ETF and iShares FTSE A50 China Index ETF futures on Monday, 10 June 2013.  The underlying ETFs, or Exchange Traded Funds, are designed to track the performance of A shares.  The futures will be HKEx’s first futures on A-share ETFs.

 Market makers and margin rates for the three A-share ETF futures will be as follows:

 Market Makers

Market makers will be providing continuous two-sided quotes good for at least 10 contracts on each side in at least the first two contract months with a maximum bid / ask spread of four times the best bid / offer spread of the underlying stock or $0.15, whichever is greater.

Margin Rates

The table below shows the minimum margins to be collected by an Exchange Participant from its clients in respect of their dealings in the contract.  The margins are based on the clearing company’s normal procedures and standard margining methodology. 

HKEx emphasises that the above are minimum rates and Exchange Participants should set their margin requirements according to their clients’ individual circumstances. 

For additional information on A-shares ETF futures, please see the 20 May 2013 news release, “HKEx to Introduce More Mainland-related Futures”, in the news release section of the HKEx website.