HKEX rolls out ‘mini’ futures designed to help investors hedge six base metals during Asian trade
- Dollar-denominated futures contracts will trade in Hong Kong and track London pricing for aluminium, zinc, copper, nickel, tin, and lead
- Settlement in Hong Kong
- New products will broaden the ability of traders to use Hong Kong for hedging, analysts say
The operator of the Hong Kong stock exchange will launch US dollar-denominated “mini” futures for six base metals on Monday, reflecting the second batch of products launched within a month as the exchange presses ahead with its strategy to become a leading Asian asset management centre within three years.
The products, known as London Metal Mini Futures, will enable trade in the Asian time zone for investors that have exposure in US dollar denominated base metals, and it will also compliment existing yuan-denominated metals contracts, HKEX said in statement.
Analysts said they were optimistic the dollar-based mini contracts would be better received by the market than the six metal contracts traded in yuan, launched by the HKEX in 2014. These have failed to take off in Hong Kong, with only one LME mini contract changing hands per day, on average, in the first half of this year, ranking as some of the thinnest traded products on the Hong Kong stock market.
