Hong Kong Exchanges and Clearing (HKEx) plans to introduce renminbi (RMB) currency futures in Q3, allowing investors to hedge RMB exposure through a US dollar/RMB futures contract.
Subject to regulatory approval, HKEx’s futures contracts will require delivery of US dollars by the seller and payment of the final settlement value in RMB by the buyer at maturity. The contract will be quoted in RMB per US dollar, or US dollar and margined in RMB, with the trading and settlement fees charged in RMB.
The exchange has scheduled a market readiness test for the end of June and invited applications from potential market makers for planned "USD/CNH" futures, trading symbol CUS.
“The initiative is part of our strategy to expand beyond equities and equity-related derivatives, offer a wide range of RMB-traded products and take advantage of the opportunities we see in fixed income, currencies and commodities,” said HKEx CEO Charles Li. “It also reflects our desire to support Hong Kong’s further development as an offshore RMB centre.”
The contract size will be US$100,000, while price quotation will be RMB per US dollar, traded from 09.00 to 16.15, Monday to Friday.
In March, HKEx implemented the second phase of its trading hours changes for securities and derivatives, bringing the exchange more in line with mainland China exchanges at Shanghai and Shenzhen. The exchange already offers RMB-denominated listings and exchange-traded funds of HKEx stocks in Shanghai.