Trading in options on Tracker Fund of Hong Kong (TRF) will commence on March 27, 2000, Monday.

As with the other 17 option classes, each TRF option contract will represent options on one board lot of the Tracker Fund of 500 shares. There will be five options market makers for this option class.

At least five strike prices, two in-the-money, one at-the-money and two out-of-the-money will be available for trading. The strike prices will depend on the closing price of the Tracker Fund on March 24. Options that expire in April, May, June and September will be available for trading, while options that expire in December will be introduced after the expiry day in March. The trading tariff for TRF will be $1.00 per contract.

Prices of TRF will be available on page 3035-36 of the Teletext system and other information vendors. Delayed options market prices will also be available through the Exchange website.

An Exchange spokesman said the introduction of options on the Tracker Fund was consistent with the need to be responsive to market demand.

Options on 18 underlying stocks will be available on the Exchange with the introduction of the Tracker Fund options.

In the first two months of 2000, the average daily turnover of options was 11,808 contracts, a 122 per cent increase over the same period in 1999.

Options on Tracker Fund offer another form of risk management tools for Tracker Fund investors. The Exchange continues to educate the investors on options in a multi-media manner. The Investment Game in Traded Options & Stocks (igTOPS) on the Internet (http://www.sehk.com.hk/igtops) has been well received by the public. igTOPS offers an excellent opportunity for investors to learn how to apply options strategies in a simulated environment using real market prices.