HKEx sees CES Indexes as 'critical platform'
24 May 2013
News, China, Global, Hong Kong
By Hui Ching-hoo
Charles Li, chief executive of Hong Kong Exchanges and Clearing Limited (HKEx), identifies the development of the soon-to-be-launched China-linked CES index series as a significant platform for the bourse to expand into the index futures business.
Speaking at a luncheon on Thursday (May 23), Mr. Li explained that the formation of the China Exchange Services Company Limited (CESC), the joint venture between the HKEx, Shanghai exchanges and Shenzhen exchanges, is critical to the bourse in that it facilitates its ETFs and index futures products.
“The key to controlling these businesses is the underlying indexes. Whoever controls the indexes has the capability to potentially develop ranges of products based on the indexes. The existing A-share indexes have yet to be fully developed,” he notes.
Mr. Li states that the indexes created by the CESC can help the bourse to build index futures licensing in Hong Kong, saying the JV will continue to diversify its index family.
Mr. Li’s remarks come days after the HKEx unveiled plans to introduce new stock index futures and stock futures on three A-share ETFs as part of its continued effort to expand its suite of mainland China-related products.
With this, CESC will license the exchange to introduce futures on the CES China 120 Index (CES 120), which is part of CESC’s Cross Border Index Series, on July 8, subject to regulatory approval.
Separately, Mr. Li notes that HKEx is considering introducing RMB settlement of commodities after the completion of its acquisition of the London Metal Exchange (LME).
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