- Hong Kong is world’s biggest equity structured products market
- Inline Warrants’ launch in July will be on 5 most actively-traded stocks1 and on the Hang Seng Index
- Complements other existing structured products such as Derivative Warrants and Callable Bull/Bear Contracts
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce the launch of Inline Warrants in July, further enhancing Hong Kong’s structured product offerings.
“The launch of Inline Warrants on HKEX marks a major new milestone in the development of Hong Kong’s structured products market,” said Calvin Tai, HKEX Co-President and Chief Operating Officer.
“It aligns with the growth focus in HKEX’s latest Strategic Plan: to accelerate the pace of development of new derivatives and structured products to enhance the attractiveness of Hong Kong’s market as the venue of choice for investors and issuers in the Asian time zone.”
Inline Warrants give investors the opportunity to receive a pre-determined fixed payment, depending on whether the price of the underlying asset falls within or outside the upper and lower strikes at the expiry of the warrant.
Investors may choose from different strike prices to express their views on the price range of the underlying asset, allowing the possibility of making profits in a sideways or flat market.
At launch in July, Inline Warrants will initially be issued on the five most actively-traded stocks on the Exchange, as well as on the Hang Seng Index.
Inline Warrants will complement HKEX’s existing structured products suite that already includes Derivative Warrants and Callable Bull/Bear Contracts (CBBCs), which are both more focused on directional trading.
Like Derivative Warrants, Inline Warrants may be bought and sold prior to their expiry on HKEX. At expiry settlement is made in cash rather than a purchase or sale of the underlying asset. Inline Warrants are issued by a third party, usually an investment bank, independent of the issuer of the underlying assets.
Hong Kong is the world’s most actively-traded market for equity structured products. In 2018, HKEX welcomed a record 11,794 new Derivative Warrants and 26,678 CBBCs, up significantly from the previous records of 7,989 new Derivative Warrants and 13,235 CBBCs a year earlier.
Further information on Inline Warrants is available on HKEX’s Inline Warrants web page.
1 Tencent (700), Ping An (2318), CCB (939), AIA (1299) and China Mobile (941)
About HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) is one of the world’s major exchange groups, and operates a range of equity, commodity, fixed income and currency markets. HKEX is the world’s leading IPO market and as Hong Kong’s only securities and derivatives exchange and sole operator of its clearing houses, it is uniquely placed to offer regional and international investors access to Asia’s most vibrant markets.
HKEX is also the global leader in metals trading, through its wholly owned subsidiaries, The London Metal Exchange (LME) and LME Clear Limited. This commodity franchise was further enhanced with the launch of Qianhai Mercantile Exchange, in China, in 2018.
HKEX launched the pioneering Shanghai-Hong Kong Stock Connect programme in 2014, further expanded with the launch of Shenzhen Connect in 2016, and the launch of Bond Connect in 2017.
www.hkexgroup.com
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