Transcript Slide 1

FTSE/Xinhua China 25 Index
(FXI China 25)
Futures & Options
Launch Date: 23rd May 2005
HKEx Corporate Mission
The mission of HKEx is to operate a
world-class marketplace for Hong Kong
and Mainland China securities and
derivatives products.
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HKEx – The Largest International Capital
Formation & Trading Centre for
Mainland Enterprises
Mainland Enterprises
For the year 2004
Market total
Total
As % of
total market
Listed companies
1,096
304
27.7%
70
44
63%
HK$6,965
billion
HK$2,020
billion
30.2%
Funds raised by IPOs
HK$97.5
billion
HK$76.4
billion
78.9%
Average daily turnover
HK$13.7
billion
HK$6.7
billion
49%
(As at end of Dec 2004)
Number of New Listings
Market capitalisation
(As at end of Dec 2004)
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HKEx – The Trading Centre for
Mainland Enterprise Derivatives
•
H-shares Index Futures
•
H-shares Index Options
•
16 Stock Options / Futures on Mainland enterprises:
6 on individual H-shares
10 on individual Red-chips
•
FXI China 25 Futures & Options
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Why FXI China 25 Index Futures & Options?
• To expand product offerings to meet market
demand for derivatives products on Mainland
enterprises listed in Hong Kong
• To complement H-shares index futures and
options trading
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Why FXI China 25 is chosen for trading?
•
Broad-based index covering both H-shares and Red-chips
suitable for derivatives trading, hedging and arbitrage
•
Constituent stocks restricted to 25 most liquid shares of
Mainland enterprises listed in Hong Kong
•
The weighting of each constituent stock is capped to
maintain a balanced composition – meets regulatory
requirements
•
Widely recognised by OTC structured products issuers with
US$3 billion of OTC products referenced to FXI China 25
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FXI China 25 Index Performance vs. HSI
FXI China 25 has out-performed the Hang Seng Index
(from Jan 2003 to Mar 2005)
% change
120%
HSI Index
FTSE Xinhua China 25 Index
100%
80%
60%
40%
20%
0%
Mar/05
Feb/05
Jan/05
Dec/04
Oct/04
Sep/04
Aug/04
Jul/04
Jun/04
Apr/04
Mar/04
Feb/04
Jan/04
Nov/03
Oct/03
Sep/03
Aug/03
Jul/03
May/03
Apr/03
Mar/03
Feb/03
Jan/03
-20%
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FXI China 25 Index 20-Days Annualised
Volatility vs. HSI
FXI China 25 has higher volatility than the Hang Seng Index
(from Jan 2003 to Mar 2005)
60%
HSI Index Volatility
FTSE Xinhua China 25 Index
50%
40%
30%
20%
10%
Mar/05
Feb/05
Jan/05
Dec/04
Nov/04
Oct/04
Sep/04
Aug/04
Jul/04
Jun/04
May/04
Apr/04
Mar/04
Feb/04
Jan/04
Dec/03
Nov/03
Oct/03
Sep/03
Aug/03
Jul/03
Jun/03
May/03
Apr/03
Mar/03
Feb/03
Jan/03
0%
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FXI China 25 Summary Statistics
• Index Level*
:
8,254.83
• Investible Market Cap*
:
HK$416.87 billion
• Average Daily Turnover#
:
of constituent stocks in HK
HK$4.31 billion
• 20-day Annualised*
Historical Volatility
:
15% (vs. HSI 11%)
• Index Return#
:
85.4% (vs. HSI 57.2%)
* As of 31 Mar 2005
# from 1 Apr 2003 to 31 Mar 2005
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FXI China 25 Index Top 10 Constituents
Ticker
Company Name
Type
941
857
2388
386
883
267
2628
2318
1199
902
China Mobile
PetroChina
BOC Hong Kong (Holdings)
China Petroleum & Chemical
CNOOC
CITIC Pacific
China Life Insurance
Ping An Insurance
COSCO Pacific
Huaneng Power International
Red-chip
H-share
Red-chip
H-share
Red-chip
Red-chip
H-share
H-share
Red-chip
H-share
*weighting as of 18 April 2005
Weighting*
9.99%
9.05%
8.12%
6.88%
5.93%
4.05%
4.05%
4.01%
4.01%
3.99%
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FXI China 25 Index Futures Summary
Trading Symbol
:
FXC
Contract Multiplier
:
HK$50
Contract Value is around*
:
HK$412,742
(vs. HK$675,844 for Hang Seng Index
Futures and HK$239,639 for H-shares
Index Futures)
Minimum Fluctuation
:
1 index point
Contract Months
:
Spot, the next calendar month, and the next
two calendar quarter months
Exchange Fee
:
HK$5.00
Settlement Fee
:
HK$5.00
Commission
:
Negotiable
*contracted value based on 31 Mar 2005 closing
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Features of FXI China 25 Futures and Options
•
Fully Automated Trading & Integrated Clearing
•
Low Transaction Costs
•
PRiME Margining System
•
Hedging Vehicle
•
Arbitrage Opportunities
•
Spread Trading with H-shares Products
•
Dynamic Options Strategies
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Waiver and Exemption
Exchange Fee
$5.00 / contract:
SFC Levy
$1.00 / contract:
3-month Waiver
after launch !
6-month Exemption
after launch !
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Joint Promotion Programmes
• Index Promotion Program sponsored by FXI
- Index guessing games
- Radio broadcast of FXI China 25 Index
• Investment Event on 21 May 2005 to be sponsored by
HKEx, sponsoring Exchange Participants and others
- Exhibitions and seminars (covering 1,200 people)
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Education & Communication Programme
•
HKEx will conduct the following education programme
-
Continuous Professional Training courses for
practitioners
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Briefings for Exchange Participants
-
Seminars for professional bodies
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Public seminars for investing public
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Questions & Answers
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