China Posts Rules on Index Futures

October 23, 2006 at 7:31 pm (China, Economics, Investment)

From The Wall Street Journal, China Posts Rules on Index Futures

 

The China Financial Futures Exchange published draft rules on stock-index futures on its Web site, setting a minimum-access threshold that analysts said could deter some investors.

Under the draft rules, each investor would deposit funds equivalent to 8% of the value of the derivatives contract, which analysts said would put the minimum threshold at about 34,400 yuan, or about $4,350.

The rules also stipulate that a single investor can hold no more than 2,000 lots of single-month futures contracts at one time.

……

According to the draft rules, published yesterday for public comment, China’s first stock-index futures will be based on a unified index that groups 300 large-capitalization stocks on both the Shanghai and Shenzhen exchanges. The rules also stipulate that the price of stock-index futures can’t rise or fall by more than 10% in one day from the previous close.

 

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