1、The Hong Kong Exchanges and Clearing Limited has launched the worlds first deliverable Reminbi currency futures.The move is expected to help both big and small investors to hedge the currency risks as well as to promote the internationalization of the Reminbi.CRIs Hong Kong correspondent Xu Weiyi ha
2、s the details.The offshore RMB currency futures contracts start trading in Hong Kong on September 17.According to Calvin Tai, Head of Trade Division of the Hong Kong Exchanges and Clearing Limited, theres no restriction on investors. They can take part in the trading as long as they pay adequate ini
3、tial margin.At the moment, we require an initial margin of 8,000 yuan for one contract. So it depends on how many contracts the investors are trading. But 8,000 yuan is the minimum margin.Seven products, or seven contract months, are available for investors. They are October, November and December o
4、f 2012 as well as January, March, June and September of 2013.The contract size is 100,000 US dollars and the period is one year. Investors can speculate on offshore RMBs value against US dollars and trade the contract accordingly.Investors can trade with margin, but when the contract matures, it wil
5、l require delivery of US dollars by the seller and payment of the Final Settlement Value in RMB by the buyer.Calvin Tai says, the launch of the RMB currency futures goes in line with the internationalization of RMB and it is also designed to meet the demand for hedging RMB currency risks.Overseas in
6、vestors have been facing increasing risks as they get more involved in RMB-related dealings, while the offshore RMB market develops and RMB products increase.Moreover, over the past few months, the one-way appreciation trend of RMB against US dollars appears to have come to an end.The market has a d
7、ifferent opinion. Some even predict that RMB will depreciate by 1 or 2 percent in the coming year. So investors demand for foreign currency risk products has gone up to a high level. I think the RMB currency futures have been introduced at the right time.In fact, RMB currency futures are not brand n
8、ew. Previously, many big investors trade non-deliverable forward, or NDF, via banks to counter risks. However, the NDF market generally does not open to small investors or small companies.Calvin Tai says, the newly introduced deliverable RMB currency futures can meet the need of individual investors
9、.So we think this futures product is completely open via a platform. Investors, large or small, can take part in the trading.The largest U.S. exchange operator, CME Group recently also announced its plans to introduce deliverable offshore RMB futures in the fourth quarter this year.Unlike the one-year contract launched by the Hong Kong Exchange, CMEs futures have a three-year contract period.For CRI, Im Xu Weiyi in Hong Kong.
