HKEX welcomes a growing number of US Stock Derivative Warrants (DWs) listing in its expanding Structured Product market! The listing represents the first time in over a decade that DWs with a US stock as the underlying asset have been listed at HKEX, marking a significant step in expanding the international exposure of HKEX’s diverse range of products. It also aligns with the increasing investor demand for US stock exposure, as demonstrated by the growing volume of US underlying Structured Products traded at HKEX.
Listed structured products are financial instruments issued by authorized financial institutions (Issuers) and traded on the cash market of HKEX. The payoff of structured products is based on the performance of the underlying asset(s), which can be stocks, stock indices, fixed income, currencies, commodities or a basket of assets. Structured products can be designed to allow investments under different expectations on price movements of underlying asset(s), such as direction and range. The maximum level of investors’ capital at risk will not exceed the initial investment amount.
The following listed structured products are currently available for listing and trading on the equity market of HKEX:
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Derivative Warrants on MSCI China A 50 Connect Index
The MSCI China A 50 Connect Index Derivative Warrants are the first listed A Share structured product in Hong Kong, providing investors a new tool to risk manage China-focused investments.
Product List [Link]
Real-time Index Values [Link]
Index Information [Link]
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Inline Warrants
Inline Warrants are a type of structured product that entitle the investors to receive a pre-determined fixed payment at expiry, depending on whether the underlying falls at or within (In-the-Range) or outside (Out-of-the-Range) the Upper and Lower Strikes at expiry.
Download [Inline Warrants Leaflet]
Download [Inline Warrants Video]
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DERIVATIVE WARRANTS
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Derivative Warrants are an instrument that gives an investor the right to "buy" or "sell" an underlying asset at a pre-set price prior to a specified expiry date. They may be bought and sold prior to their expiry in the market provided by HKEX. At expiry settlement is made in cash rather than a purchase or sale of the underlying asset. Derivative Warrants can be issued over a range of assets, including stocks, stock indices, currencies, commodities, or a basket of securities. They are issued by a third party, usually an investment bank, independent of the issuer of the underlying assets. Derivative Warrants traded in Hong Kong normally have an initial life of six months to two years and when trading in the market each derivative warrant is likely to have a unique expiry date.
[Derivative Warrants Factsheet]
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CALLABLE BULL / BEAR CONTRACTS
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CBBC are a type of structured product that tracks the performance of an underlying asset without requiring investors to pay the full price required to own the actual asset. They are issued either as Bull or Bear contracts with a fixed expiry date, allowing investors to take bullish or bearish positions on the underlying asset. CBBC are issued by a third party, usually an investment bank, independent of HKEX and of the underlying asset.
CBBC are issued with the condition that during their lifespan they will be called by the issuers when the price of the underlying asset reaches a level (known as the " Call Price ") specified in the listing document. If the Call Price is reached before expiry, the CBBC will expire early and the trading of that CBBC will be terminated immediately. The specified expiry date from the listing document will no longer be valid.
CBBC may be issued with a lifespan of three months to five years and are settled in cash only. They are traded on the cash market of HKEX.
[Callable Bull/Bear Contracts Factsheet]
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INLINE WARRANTS
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Inline Warrants are a type of structured product that entitles the investors to receive a pre-determined fixed payment at expiry. At expiry, investors will receive HK$1 per inline warrant held when the underlying asset falls at or within the Upper and Lower Strikes (In-The-Range) or HK$0.25 per inline warrant held when the underlying asset falls outside the Upper and Lower Strikes (Out-of-The-Range).
Due to the pre-determined fixed maximum payment at expiry of HK$1, an inline warrant should not be traded above HK$1. Investors will suffer a loss by buying an inline warrant above HK$1.
Inline Warrants may be issued with a lifespan of six months to five years. They may be bought and sold prior to their expiry on the cash market of HKEX. At expiry, settlement is made in cash only.
Inline Warrants are issued by a third party, usually an investment bank, independent of HKEX and of the underlying asset.
Please refer to the Inline Warrants – Product Factsheet for details.
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HKEX and/or its subsidiaries endeavour to ensure the accuracy and reliability of the information provided, but do not guarantee its accuracy and reliability and accept no liability (whether in tort or contract or otherwise) for any loss or damage arising from any inaccuracy or omission or from any decision, action or non-action based on or in reliance upon information contained in this website. Where the information is supplied by a third party, it is displayed on an "as is" basis. HKEX and/or its subsidiaries do not warrant and make no representation as to the accuracy, reliability, updatedness and completeness of the information and accepted no liability (whether in tort or contract or otherwise) for any claim, loss or damage arising directly or indirectly from any inaccuracies or omissions, or the use of or reliance on any information or otherwise howsoever.
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