The Hong Kong Futures Exchange (HKFE) said today that Hang Seng Properties Sub-index (PSI) Options will be introduced for trading on 9 June 1999 on HKATS (Hong Kong Futures Automated Trading System) and PSI Futures will be re-introduced on HKATS on the same date. The PSI tracks the performance of the 12 property-related stocks in the Hang Seng Index.
MeesPierson Futures Clearing Services (Asia) Ltd., Phillip Commodities (H.K.) Ltd., and Timber Hill Hong Kong Ltd. will be market makers for PSI Options. Like the HKFE's flagship Hang Seng Index Futures product, there will be no market makers for PSI Futures.
"PSI Futures and Options enable investors to manage their property-related exposures more effectively and efficiently," said HKFE Executive Director Jimmy Ho, who heads the Exchange's Products Division said. "They are also important complements to our Hang Seng Index and Hang Seng 100 futures and options.
"There's a high correlation between the PSI and other property price indices so the PSI can be used as a benchmark for the overall performance of the property market as well as property stock prices. Property is one of the pillars of the Hong Kong economy so we think these are perfect products for our market," Mr. Ho added.
He also thinks PSI Futures and Options will be attractive to a wide range of market participants, including financial institutions and property developers.
"The property market, which is very volatile, is a major source of income for most of the financial institutions in Hong Kong. PSI Futures and Options will give institutions an ideal tool for managing that heavy exposure," Mr. Ho explained. "And we think property developers, who own land, buildings and property stocks, will be interested in using PSI Futures and Options to hedge their inventories and shareholdings."
The capitalisation-weighted PSI is compiled and published by HSI Services Limited, which also compiles and publishes Hong Kong's benchmark stock market barometer - the 33-stock Hang Seng Index. The 12 stocks in the PSI are Amoy Properties, Cheung Kong (Holdings), China Resources Enterprises, Great Eagle Holdings, Hang Lung Development, Henderson Investment, Henderson Land Development, Hopewell Holdings, Hysan Development, New World Development, Sino Land and Sun Hung Kai Properties.
The Hong Kong Futures Exchange is a leading futures and options marketplace in the Asia Pacific Region, with a membership of over 130 companies, including a number of major international institutions. The Exchange is actively diversifying its product base, which now includes currency, interest rate and equity-based products.
For further enquiries, please contact HKFE Corporate Communications Manager Miss Chiu Yeung on 2842 9322.