Published On: Sun, Sep 29th, 2013

HKEx Announces US Access to its CES 120 and VHSI Volatility Futures

The Hong Kong Futures Exchange (HKFE), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEx), announced today (Monday) that investors in the US can now trade its CES China 120 Index (CES 120) futures and HSI Volatility Index (VHSI) futures contracts directly from within the country, after they were certified by the US’s Commodity Futures Trading Commission (CFTC).

Calvin Tai, HKEx Co-head of Equities and FIC

Calvin Tai, HKEx Co-head of Equities and FIC

The CES 120 futures contract is the world’s first exchange-traded futures contract with an index that tracks A shares of Mainland companies as well as Mainland stocks listed in Hong Kong. It is a convenient, cost effective way to gain exposure to the Mainland and Hong Kong stock markets.

The underlying index of the VHSI futures contract tracks the implied volatility of Hang Seng Index (HSI) options, making the contract an ideal tool for investors looking to manage volatility risk in Hong Kong’s stock market. VHSI futures complement HKEx’s HSI options and can be used as a pure play on implied volatility independent of the direction and level of stock prices.

HKEx has been offering its HSI futures, Mini HSI futures, H-shares Index futures and Mini H-shares Index futures in the US under previous decisions by the CFTC.

Investors from overseas provide about a quarter of the trading volume in HKEx’s derivatives market and the US accounts for 16 per cent of overseas investors’ trading, according to HKEx’s latest Derivatives Market Transaction Survey.

“The US is one of our most important markets and the CFTC certification of VHSI and CES 120 futures enables us to bring our volatility and China futures products directly to investors in the US,” said Calvin Tai, HKEx’s Co-head of Equities and Fixed Income and Currency. “We are optimistic about attracting more US investor interest in our futures products, which offer diversity and easy access to China exposure.”

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