Securities

The issuer’s existing derivative warrants are still valid and you can continue to trade them through the Exchange trading system. The issuer must publish an announcement regarding the credit rating downgrade and continue to provide liquidity for its existing derivative warrants and perform its settlement obligations upon expiry.

However, when an issuer no longer meets the eligibility requirements in the Listing Rules, the issuer will not be allowed to launch new issues or further issues.  It must apply for the withdrawal of derivative warrants launched but not yet listed and all derivative warrants with no outstanding positions held by the public.

You should be cautious that prices of derivative warrants issued by the affected issuer may be affected by its or its guarantor’s credit downgrade. For the avoidance of doubt, where the issuer or the guarantor relies on the credit rating of their respective holding company for satisfying the eligibility requirements under the Listing Rules, such credit rating is for investors’ reference only, and investors shall have no recourse against the relevant holding company under the terms of the derivative warrants.

You can access information about the credit ratings of the issuers, their guarantors (if any) or their respective holding companies (where such credit rating is relied upon for satisfying the eligibility requirements in the Listing Rules) on the HKEX’s website.

Investors should be aware that trading activity may be concentrated among a small number of participants. In such cases, a high proportion of turnover may be driven by the trading strategies of a few investors rather than broad market demand. If these investors change or withdraw their positions, liquidity may decline rapidly, potentially making it more difficult to trade the product at expected prices.

Investors should refer to the List of Structured Products with High Trading Concentration which highlights derivative warrants where trading activity is concentrated among a small group of investors.

No, investors should not rely solely on turnover when selecting derivative warrants. In assessing liquidity, investors should also consider other factors, including but not limited to the bid‑ask spread, the quote size provided by liquidity providers and the duration for which quotes are available.

The issuer’s existing CBBCs are still valid and you can continue to trade them through the Exchange trading system. The issuer must publish an announcement regarding the credit rating downgrade and continue to provide liquidity for its existing CBBCs and perform its settlement obligations upon expiry.

However, when an issuer no longer meets the eligibility requirements in the Listing Rules, the issuer will not be allowed to launch new issues or further issues.  It must apply for the withdrawal of CBBCs launched but not yet listed and all CBBCs with no outstanding positions held by the public.

You should be cautious that prices of CBBCs issued by the affected issuer may be affected by its or its guarantor’s credit downgrade. For the avoidance of doubt, where the issuer or the guarantor relies on the credit rating of their respective holding company for satisfying the eligibility requirements under the Listing Rules, such credit rating is for investors’ reference only, and investors shall have no recourse against the relevant holding company under the terms of the CBBCs.

You can access information about the credit ratings of the issuers, their guarantors (if any) or their respective holding companies (where such credit rating is relied upon for satisfying the eligibility requirements in the Listing Rules) on the HKEX’s website.

Not necessarily. While high turnover may suggest that a CBBC is actively traded, it does not always reflect sustainable liquidity.

Investors should be aware that trading activity may be concentrated among a small number of participants. In such cases, a high proportion of turnover may be driven by the trading strategies of a few investors rather than broad market demand. If these investors change or withdraw their positions, liquidity may decline rapidly, potentially making it more difficult to trade the product at expected prices.

Investors should refer to the List of Structured Products with High Trading Concentration which highlights CBBCs where trading activity is concentrated among a small group of investors.

No, investors should not rely solely on turnover when selecting CBBCs. In assessing liquidity, investors should also consider other factors, including but not limited to the bid‑ask spread, the quote size provided by liquidity providers and the duration for which quotes are available.