Hong Kong Futures Exchange Limited (HKFE), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), has announced margin rates for the TSI Iron Ore Fines 62% Fe CFR China Futures (Iron Ore Futures) that will begin trading on HKEX on Monday, 13 November 2017.
The Client Margin table below shows the minimum margins to be collected by an Exchange Participant from its clients in respect of their dealings in the contract. The margins are based on the clearing company’s normal procedures and standard margining methodology.
Mainland China is the world’s largest iron ore consumer and importer. Last year, its imports rose to an all-time high of more than 1.024 billion tonnes.
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Client Margin
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Initial
(US$) |
Maintenance
(US$) |
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TSI Iron Ore Fines 62% Fe CFR China Futures
Monthly Contracts
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Full Rate
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659
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/lot
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527
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/lot
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Spread Rate
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289
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/spread
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231
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/spread
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Inter-Commodity Spread
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Please see table below
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TSI Iron Ore Fines 62% Fe CFR China Futures
Quarterly Contracts
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Full Rate
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486
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/lot
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388
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/lot
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Spread Rate
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321
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/spread
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256
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/spread
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Inter-Commodity Spread
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Please see table below
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Inter-commodity Spread Credit Rates
(With effect from 13 November, 2017)
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Product Pair
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Delta/Spread Ratio
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Spread Credit Rate
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TSI Iron Ore Fines 62% Fe CFR China Futures Monthly Contracts
vs
TSI Iron Ore Fines 62% Fe CFR China Futures Quarterly Contracts
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1 vs 2*
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64%
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A ratio with positive value means the net deltas of the two products shall be of opposite direction (eg, one net long delta in TSI Iron Ore Fines 62% Fe CFR China Futures Monthly Contract and two net short delta in TSI Iron Ore Fines 62% Fe CFR China Futures Quarterly Contract) in order to form inter-commodity spread. In PRiME, the margining methodology HKEX uses, this is represented by A vs B, indicating opposite side of the market for the two products. For details, please refer to PRiME Margining Guide. |
To encourage market participation and liquidity building, there will be an Exchange Fee holiday and 100 per cent SFC levy exemption for the entire market for Iron Ore Futures’ first six months of the HKFE.
Additional margin information is available in a circular on the HKEX website. Additional product information is available the Iron Ore Futures news releases posted on the HKEX website and the product section of the website.
Ends