Hong Kong launches new tranche of MSCI futures contracts – Citywire

Hong Kong Exchanges and Clearing has launched its latest batch of futures contracts as part of its new index licensing agreement with MSCI.

The eight MSCI index futures contracts are denominated in US dollars and track equities in China, India, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam, it said.

HKEX will launch a further eight USD-denominated futures contracts on 17 August, adding to its 17 MSCI index futures contracts rolled out in July.

Under its partnership with MSCI inked in May, HKEX received 37 futures and options contracts. Following the August listings, the Hong Kong boursew ould have launched 33 contracts with another four planned later this year.

The 10-year licensing agreement is a major boost for Hong Kong, an economy that has been hit with long-drawn protests and Beijing’s latest legislature play.

MSCI had previously partnered with the Singapore Exchange, but the agreement is set to expire in February 2021.

The global index provider sees Hong Kong as a larger customer base, particularly with access to Chinese institutional and retail investors.

The decision to move the contract from SGX to HKEX was not made on the basis of larger fees or money, said MSCI CEO Henry Fernandez previously.

Since confirming the partnership, HKEX has also launched its first set of Hong Kong-listed A-share leveraged and inverse products at a time when international capital is flowing into the mainland stock market.

Total northbound turnover of the Stock Connect reached RMB 9.76tn ($1.4tn) in 2019, representing a 109% increase year-on-year.

In the case of SGX, the Singapore bourse has since introduced the SGX FTSE Taiwan Index futures contract on the FTSE Taiwan RIC Capped Index to enable global investors gain exposure to Taiwan stocks.

This launch came shortly after SGX bought the remaining 80% stake in BidFX, a cloud-based FX trading platform, for $128m.

The move is meant to expand SGX’s reach beyond FX futures and into the global FX over-the-counter market that has a daily turnover of $6.6tn by traded volume.





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