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Hong Kong Exchanges and Clearing Limited (HKEX) plans to introduce Mini-Hang Seng China Enterprises Index Options (Mini H-shares Index Options) on Monday, 5 September 2016 to meet demand from retail investors and give market participants more flexibility by providing a contract one-fifth the size of its H-shares Index Options contract. A contract summary is in Table 1 below.
Mini H-shares Index Options will complement the H-shares Index and mini stock index futures and options currently offered by HKEX (see Table 2 below). HKEX has invited applications for market makers for the new product.
Other Derivatives Market Enhancements
Starting from November 2016, HKEX will offer a fourth calendar month contract for its H-shares Index Options and Hang Seng Index Options (HSI Options) to support trading close to the expiry of the third calendar month contract. Contract months available for trading in the coming November are listed in Table 3 below.
HKEX also plans to introduce a Primary Market Maker programme in its H-shares Index Options and HSI Options markets on 1 November 2016 along with revised obligations for market makers that provide continuous quotes and market makers that respond to quote requests in its stock index options and stock options markets as well as enhanced market making support in those two markets. For details, please see the stock index options and stock options enhancement measures circulars issued today.
Table 1 - Mini H-shares Index Options Contract Summary
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Underlying Index |
Hang Seng China Enterprises Index |
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Contract Multiplier |
$10 per index point |
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Minimum Fluctuation |
One index point |
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Contract Months |
Spot, next calendar month and next two calendar quarter months |
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Exercise Style |
European Style |
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Option Premium |
Quoted in whole index points |
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Strike Prices |
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Trading Hours |
9:15 am - 12:00 noon and 1:00 pm - 4:30 pm |
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Expiry Day |
The business day immediately preceding the last business day of the contract month |
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Official Settlement |
The average of quotations taken at: 5-minute intervals from 5 minutes after the start of, and up to 5 minutes before the end of trading; and the close of trading on the Stock Exchange on the Last Trading Day. |
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Transaction Costs |
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Table 2 - HKEX’s Current Mini Stock Futures and Options
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Contract |
Launch date |
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Mini-HSI Futures |
9 Oct 2000 |
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Mini-HSI Options |
8 Nov 2002 |
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Mini H-shares Index Futures |
31 Mar 2008 |
Table 3 - Contract Months for HSI and H-shares Index Options in November 2016
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HSI Options |
Short-dated Options: Nov and Dec 2016; Jan, Feb (new), Mar, Jun, Sep 2017; and |
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H-shares Index Options |
Short-dated Options: Nov and Dec 2016; Jan, Feb (new), Mar, Jun, Sep 2017; and |
