Update | Gold futures debut better than expected
As of 7.30pm, 3,098 contracts had changed hands, 2,186 priced in yuan and 912 in US dollars
Two newly launched gold futures products in the Hong Kong market debuted to better than expected turnover on Monday, as gold traders credited physical delivery settlement and longer trading hours for the strong start.
The two products, one traded in US dollars, the other in yuan, mark the third attempt by the local stock exchange to step into gold trading.
As of 7.30pm – 11 hours after their debut at 8.30am – 3,098 futures contracts had changed hands. Of these, 2,186 were priced in yuan and 912 in US dollars. Each contract represents one kilogram of gold. They will continue to trade until 1am Tuesday morning.
“The first day’s turnover of the two gold futures was better than expected. The gold market is pretty quiet on Mondays but the fact the HKEX could still achieve such a higher turnover make for a strong debut,” said Jasper Lo Cho-yan, the chief strategist at King International Financial.
Lo said yuan gold futures were more attractive than US dollar gold futures partly because investors expect the yuan to rise in value against the US dollar.
“Investors who bet on yuan gold futures would benefit from both a rise in gold prices and the appreciation of the yuan,” he said.