Shanghai And Shenzhen 300 Stock Index Icebreaking Financial Options Derivatives Market "Infrastructure" Further

Ice breaking of stock index options

On November 8, Chang depeng, a spokesman for the CSRC, said that the pilot work of expanding stock index options was officially launched, and the Shanghai Shenzhen 300 ETF options listed on the Shanghai Stock Exchange and Shenzhen Stock Exchange and the Shanghai Shenzhen 300 index options listed on the China financial exchange were approved in accordance with the procedures. The reason why Shanghai and Shenzhen 300 should be chosen as a breakthrough is that regulators probably value the good cash base of the CSI 300 index. Shanghai and Shenzhen 300 index market has a high degree of acceptance and covers more than Shanghai Stock Exchange 50. Listing related options can help the market significantly improve the hedging effect.

Infrastructure construction in the domestic derivatives market began to accelerate.

On November 8, Chang depeng, a spokesman for the CSRC, said that the pilot work of expanding stock index options was officially launched, and the Shanghai Shenzhen 300 ETF options listed on the Shanghai Stock Exchange and Shenzhen Stock Exchange and the Shanghai Shenzhen 300 index options listed on the China financial exchange were approved in accordance with the procedures.

On November 10, CICC issued a notice to solicit opinions from the public on the Shanghai and Shenzhen 300 stock index option contracts and relevant rules, and the Shanghai and Shenzhen 300 stock index option contracts and detailed trading rules were exposed.

It should be noted that the CSI 300 stock index option is the first financial option product launched by CICC. With the listing of this product in the future, the financial futures product layout of CICC may be expanded to Shanghai Stock Exchange 50 stock index options, China Stock Exchange 500 stock index options, or even national debt options.

However, these are all long-term goals. It is still necessary for the 300 stock index options in Shanghai and Shenzhen to operate stably and gradually mature before they can be implemented.

In the short term, the listing of Shanghai and Shenzhen 300 stock index options will not only improve the construction of infrastructure in the domestic derivatives market, but also greatly enhance the risk management market capacity and hedge efficiency.

Advance hedging and precise hedging

As the first financial option product of CICC, the CSI 300 index is chosen as a pilot project.

On the one hand, the Shanghai and Shenzhen 300 stock index futures have been listed for nearly 10 years, and its stability has been tested by the market. On the other hand, the CSI 300 stock index futures have a wider coverage, including the most representative listed companies in the two markets.

The 21st century economic report reporter learned that the top 20 countries and regions in the global GDP and stock market value have launched stock index option products, and Brazil, Russia, India, South Africa and other emerging transition economies have also launched stock index option products.

In contrast, in China, there were only three major stock index futures products of SSE 50ETF options and CFE before. The system of derivatives market has not been established completely, let alone the effective play of hedging function.

Another background that can not be ignored is that the pace of opening up capital markets has accelerated significantly since last year.

"In the context of international investors continuing to add to the domestic market, China should provide corresponding hedging tools, not only for domestic investors, but also for international investors." Han Qian, a professor at the school of economics of Xiamen University who has been tracking the financial derivatives market for a long time, commented on November 11.

This year, from the inclusion of a shares in MSCI and other three major international mainstream indexes to the removal of QFII and rqfii investment quota restrictions, to the continued inflow of funds from the north, the original capacity of the domestic risk management market needs to be improved.

According to statistics, as of November 8th, the north capital shareholding has reached 881 billion yuan, an increase of 37% over the end of last year.

By using stock index options, northbound funds and domestic institutions can hedge risks through trading options. While locking down risks, investors will not miss the opportunity of market gains, which will greatly encourage institutional investors to make long-term investment.

In addition, with the introduction of Shanghai and Shenzhen 300 stock index options, the efficiency of risk management of domestic and foreign investors will undoubtedly be significantly improved.

Beijing, a senior trader with Wall Street background, pointed out in November 11th that "option is a nonlinear hedging tool. It is a dimension higher than futures. It can achieve hedging ahead, precise hedging, reducing timing requirements, and more active and flexible risk management."

CITIC futures financial futures team pointed out that options can more accurately reflect the market outlook.

Just take the bullish market as an example, the most basic operation is to buy futures to gain gains. With the stock index option products, we can further refine the view and operation of call.

For example, if you think that the price will rise in the next month, you can choose to buy near month call options, and think that the price will rise by 10% in the next month, you can choose to buy near month call options with virtual value, and think that the price will rise by 10% - 20% in the next month, then you can choose to buy bull market value portfolio.

Financial futures "push new ideas" forward looking

With the news of the expansion of the options team landing, the path of "pushing the new" of the entire option market has also become clearer.

Based on the original Shanghai Stock Exchange 50ETF options, Shanghai and Shenzhen stock exchange continued to enrich its ETF options product layout, such as China Stock Exchange 500etf options.

For CICC, there are two ways to push forward. One is to further expand the capacity of Shanghai and Shenzhen 300 stock index options to Shanghai 50 index and China 500 index. The other is to improve the layout of basic financial futures instruments and try to launch foreign exchange futures on the basis of stock index futures and treasury bond futures.

"The premise of pushing forward the new is that in the future, the CSI 300 stock index options will be able to operate stably, and the market functions can be brought into full play, so the exchange will expand its capacity to other varieties, such as selecting some indexes that are quite different from CSI 300 cost shares, and of course, it does not exclude the possibility of involving gem and sci-tech innovation board." Han Qian said.

It should be pointed out that the gradual maturity of stock index options is a long-term process, and the initial stage of listing should not be too extravagant for the full play of its market functions.

The 21st century economic reporter noted that from the experience of similar promotion or expansion of commodity futures, the expansion interval of new varieties in domestic futures market is short for half a year, long for several years.

Although there is no way to judge the specific time point, the launch of Shanghai Stock Exchange 50 stock index options, China Stock Exchange 500 stock index options, even from stock index options to Treasury bond options, to a longer-term foreign exchange futures listing and foreign exchange options are the only way. At that time, the layout of the basic instruments in the domestic financial futures market will be officially completed. At present, it is just the middle game.

However, in the view of the aforementioned traders, because index options are more used to disperse systemic risks, there is no need to expand the stock index options in a large scale in the short term.

He pointed out that, referring to the overseas market, the most active stock index options are relatively concentrated. For example, the highest trading volume in the United States is the S & P 500 stock index options (S & P 500 stock index options). Other stock index options, such as the Dow Jones index, are not very high in trading volume. "At present, it is quite good that China can take the lead in testing the Shanghai and Shenzhen 300 stock index options.".

From the perspective of practical operation, the coverage of CSI 300 stock index options is wider, which can meet the hedging needs of various institutions. At the same time, the contract value of CSI 300 stock index options is greater than the previous products, and the size and liquidity of the contract are more suitable for institutional transactions.

The direct effect is that institutions can hedge risk through "spending money", rather than blindly reducing the stock spot, which not only reduces the impact on the market, but also helps to reduce the market volatility.