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Hong Kong stock market
BusinessBanking & Finance

Hong Kong Stock Exchange: derivatives, ETF trading rise to offset slump in IPO, share markets, as ‘diversification efforts pay off’

  • Hong Kong ranked top for securities derivative trading worldwide again, but fell to 5th from 3rd for IPO
  • ‘Our derivatives market is now taking centre stage as HKEX’s market diversification efforts pay off,’ says CEO Aguzin

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Hong Kong Exchanges and Clearing (HKEX), which runs Asia’s third-largest stock market, reported strong growth in derivatives and ETF trading. Photo: Bloomberg
Enoch Yiu
Hong Kong Exchanges and Clearing (HKEX), which runs Asia’s third-largest stock market, reported strong growth in derivatives and ETF trading despite a big fall in new listings, in an indication that the bourse operator has successfully diversified its business model.
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Total derivatives trading rose by 4 per cent this year as of November to 1.4 million contracts a day, HKEX said on Wednesday as it revealed its annual data. Driving growth is futures and options tracked by MSCI indexes, with several in the series having doubled their turnover in the first 11 months from the same period a year ago.
Hang Seng China Enterprises Index futures and options rose 55 per cent and Hang Seng Tech Index futures trading saw 31 per cent growth.

Benchmark Hang Seng Index futures saw turnover drop 16 per cent but open interest rose 18 per cent. Its MSCI futures and options products saw open interest exceed 100,000 contracts for the first time in November, with a nominal value of US$4.2 billion.

Open interest is the total number of futures contracts held by traders at the end of the trading day. A large number indicates investors have a strong desire to keep the contracts, showing the depth of liquidity.

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HKEX CEO Nicolas Aguzin on the future of Hong Kong’s capital market

HKEX CEO Nicolas Aguzin on the future of Hong Kong’s capital market

HKEX maintained its title as host to the world’s most traded securities derivative and warrant markets, with total turnover of US$307.26 billion in the first 10 months of this year, much higher than the second placed Boerse Stuttgart on US$42.15 billion Euronext in third with US$23.87 billion, according to data from the World Federation of Exchanges.

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