To meet the needs of retail investors with an interest in the Hong Kong stock market, the Hong Kong Futures Exchange (HKFE) has introduced a Mini-Hang Seng Index (Mini-HSI) futures contract since 9 October 2000. To complement Mini-HSI futures, Mini-HSI option contracts will be launched on 18 November 2002.
The compact, Mini-HSI futures & option contracts are based on Hong Kong's benchmark Hang Seng Index (HSI), which is also the underlying index for the larger sized HSI futures & option contracts. The contract multiplier of the Mini-HSI futures & option contracts are HK$10.00 or one-fifth the size of the HSI futures & option contracts. Same as the HSI futures & option contracts, the settlement method for the mini contracts are cash settled.
Local retail investors who have less risk capital and lower hedging requirements will find the Mini-HSI futures and option contracts the most appropriate investment tools as well as hedging instruments for managing their market risk.
| Commodity Name |
Mini-Hang Seng Index Options |
| Location |
Hong Kong |
| Exchange |
Hong Kong Futures Exchange Limited |
| Underlying Index/Index |
Hang Seng Index (the share price index of that name compiled, computed and disseminated by HSI Services Ltd.)* |
| Contract Multiplier |
HK$10 per Index point* |
| Contract Months |
Spot Month, the next calendar month and the next two calendar quarter months (i.e. quarter months are March, June, September and December). |
| Trading Hours |
| Hong Kong Time |
09:45am - 12:30pm
02:30pm - 04:15pm |
|
| Trading Hours on Last Trading Date |
| Hong Kong Time |
09:45am - 12:30pm
02:30pm - 04:00pm # |
# The closing time shall be adjusted automatically to correspond with the closing time of the underlying cash market, as it may be set from time to time.
|
| Trading Method |
The Exchange's Automated Trading System (HKATS) |
| Expiry Day |
The Business Day immediately preceding the last Business Day of the Contract Month. |
| Option Premium |
Option Premium is quoted in whole index points |
| Contracted Value |
Option Premium multiplied by the Contract Multiplier |
| Cabinet Trade |
HK$2.00 per contract to include all applicable fees and levies |
| Strike Prices |
| Strike Prices shall be set as follows: |
|
| HSCEI (Index points) |
Intervals |
| Below 2,000 |
50 |
| At or above 2,000 but below 8,000 |
100 |
| At or above 8,000 |
200 |
On any business day, new consecutive Strike Prices may be set for, or added to, each Option Contract (other than the Spot Month Option Contract on or after the 5th business day preceding the Expiry Day) such that at all times there will be Strike Prices representing not less than 10% above, at, and not less than 10% below the at-the-money Strike Price of the Option Contract. On any business day in a given month, the at-the-money Strike Price of each Option Contract shall be the previous business day's Closing Quotation (as defined in the HKCC Rules) of (i) the Spot Month Mini-HSI Futures Contract for any day prior to the Expiry Day; and (ii) the next month Mini-HSI Futures Contract for any day on or after the Expiry Day, rounded off to the nearest Strike Price, unless the Closing Quotation is precisely midway between two Strike Prices in which case it shall be rounded off to the lower Strike Price.
Strike Prices shall be set on a temporary basis at other intervals as may from time to time be determined by the Chief Executive in consultation with the Commission or at other intervals as may from time to time be determined by the Board in consultation with the Commission. The Exchange reserves the right to introduce new or delete existing Strike Prices at any time.
|
| Exercise Style |
European Style options which may only be exercised on Expiry Day. |
| Settlement on Exercise |
Cash settlement of the Final Settlement Value. |
| Final Settlement Price |
Business Day immediately following Expiry Day |
| Official Settlement Price |
The Official Settlement Price for Mini-Hang Seng Index Options shall be a number, rounded down to the nearest whole number, determined by the Clearing House and shall be the average of the quotations of the Hang Seng Index taken at five (5) minute intervals during the Expiry Day and compiled, computed and disseminated by HSI Services Ltd. The Chief Executive of the Exchange has the power under the Regulations for trading Stock Index Options to determine the Official Settlement Price under certain circumstances. |
| Position Limits |
Position delta for Hang Seng Index Futures, Hang Seng Index Options, Mini-Hang Seng Index Futures and Mini-Hang Seng Index Options combined of 10,000 long or short in all Contract Months combined provided the position delta for Mini-Hang Seng Index Futures or Mini-Hang Seng Index Options shall not at any time exceed 2,000 long or short in all Contract Months combined. For this purpose, the position delta of one Mini-Hang Seng Index Futures Contract will have a value of 0.2 and the position delta of one Mini-Hang Seng Index Option Contract will be one-fifth of the position delta of the corresponding series in the Hang Seng Index Option Contract. |
| Large Open Positions |
2,500 net long or net short contracts, in any one series, per Exchange Participant for the Exchange Participant's own behalf; and
2,500 net long or net short contracts, in any one series, per Client.
|
| Minimum Fluctuation |
One index point |
Trading Fees & Levies
(Per Contract Per Side) |
| Exchange Fee |
HK$ 2.00 |
| SFC Levy |
HK$ 0.16 |
| Total |
HK$ 2.16 |
|
| Exercise Fees |
Options that are exercised on Expiry Day shall attract an Exercise Fee of HK$2.00 per contract. Contracts that are not exercised by the Clearing House will be deemed to have expired worthless and will not attract an Exercise Fee. |
* Same as the Mini-Hang Seng Index Futures Contract.
The above information is subject to change upon market condition.
