Hong Kong Exchanges and Clearing Limited (HKEx) has announced the arrangements for the adjustment to the contract terms of all open Zijin Mining options contracts in existence after the market close on 10 June 2011 to account for Zijin Mining’s bonusissue comprising an additional five ordinary shares for each 10 ordinary shares held.
Highlights of the adjustment arrangements are shown below. Investors should consult their brokers for further details, or if they have any questions regarding the adjustment.
Underlying Stock (Stock Code) |
Zijin Mining Group Company Limited (2899) |
HKATS Code |
ZJM |
Corporate Action |
Issue of an additional 5 ordinary shares for each 10 ordinary shares |
Ex-bonus day |
13 June 2011 |
Adjustment Procedures
Adjustments will be made to the open positions which exist after the market close on 10 June 2011, the business day immediately before the ex-bonus day. Details of the adjustment procedures are as follows:
Adjustment Term |
Formula |
Remark |
Adjustment Ratio (AR) |
10 shares / (10 shares + 5 bonus shares) = 0.6667 |
Rounded to the nearest 4 decimal places |
Adjusted Exercise Price (AEP) |
Exercise price of outstanding option series x AR |
Rounded to the nearest 2 decimal places |
Adjusted Contract Size (ACS) |
Exercise price of outstanding option series x (2,000 shares / AEP) |
Rounded to the nearest 4 decimal places |
Trading of Adjusted and Standard Contracts
After the market close on 10 June 2011, the business day immediately before the ex-bonus day, the open positions will be transferred to the adjusted option series. In addition, new option series based on the standard contract size will be introduced for trading on the ex-bonus day, 13 June 2011. Details of the adjusted and standard contracts available for trading on and after the ex-bonus day are shown below:
Contract |
Trading Symbol |
Contract Size(Shares) |
Availability For Trading |
Addition of New Option Series |
Adjusted |
ZJA |
ACS |
From ex-bonus day to 29 March 2012 |
No |
Standard |
ZJM |
2,000 |
From ex-bonus day onwards |
Yes |
Investors should note that the adjusted and standard option series have different contract sizes. There will not be any changes to the number of open positions and other contract terms after the transfer of positions.