Derivatives trade dominated by brokers
Hong Kong Exchanges and Clearing's annual survey found that more than half of local derivatives trading is conducted by brokers, while local retail investors like to trade miniature contracts, which require a smaller deposit than ordinary contracts.
The exchange's annual survey of the 166 futures brokerages in the city showed that for the year to the end of June last year, derivatives market turnover increased to 56.6 million contracts, up 65 per cent year on year.
Fifty-five per cent of the total trades were conducted by brokers as proprietary trades or as market makers, compared with 47 per cent a year earlier.
Local investor activity dropped to 24 per cent, down from 29 per cent a year earlier. Overseas investors accounted for 21 per cent of the total, down from 23 per cent in the previous year.
By volume, stock options trading grew 97 per cent to 26.3 million contracts for the year to June 30 last year, from 13.4 million contracts a year earlier.
Hang Seng Index futures are most popular among overseas institutional investors, who represent 35 per cent of all trades in this type of product, Local retail investors account for 30 per cent.
Thirty-one per cent of retail investors traded derivatives online, up from 22 per cent a year earlier.