At the 2019 FOW Derivatives World Asia (FOW DW Asia) held in Hong Kong on April 3, an official of Dalian Commodity Exchange (DCE) says that smooth operation has been seen in iron ore futures since it ushered in overseas traders, presenting a good start. DCE will continue to optimize relevant systems, accelerate the listing of iron ore options, and gradually roll out more products for the internationalization business upon research.
The topic for the 2019 FOW DW Asia is the development of the bulk commodity and derivatives markets. Apart from a keynote speech, it has two parallel sessions on China and Asia respectively to discuss the latest development trend of the Chinese and international derivatives markets. Attending the meeting are more than 600 representatives from major exchanges, futures broker companies, banks, funds and investment institutions in the world.
The DCE official says in the speech on the “Internationalization of the Chinese Futures Products” that in 2018, the Chinese iron ore futures reached the accumulated trading volume of 236 million contracts, the average daily trading volume of 970,000 contracts and the average daily open interest of 810,000 contracts. Till February 2019, 118 overseas clients from 12 countries or regions have opened accounts, and 79 of them have involved in trading. The average daily trading volume of overseas clients is 21,000 contracts, and their average daily open interest is 5,071 contracts. She adds that over the past one year since the internationalization of the Chinese iron ore futures, its market structure has kept optimizing, and the trading volume and position ratio of corporate clients have further increased. Besides, the correlation of the domestic and overseas prices of the Chinese iron ore futures has maintained at a good level; industry clients at home and abroad have begun to engage in basis trading via the “futures price + premium and discount”; and the futures price has become a key reference for the pricing of spot trading at iron ore ports.
DCE has widely solicited the opinions of the market, paid attention to market feedbacks, and actively encouraged various overseas participants to involve in the iron ore futures market since the opening-up of the Chinese iron ore futures. Currently, overseas individual investors and fund clients in duty-free areas have been allowed to open accounts for trading. In addition, the China Securities Regulatory Commission gave an official written reply to DCE on January 10, approving DCE as a qualified central counter party (QCCP). It would help to attract overseas investment institutions and investors to take part in the domestic futures market trading, with a great significance for the exchange, the market participants and the whole futures market. She says that DCE will further optimize the management on account-opening and the investor suitability system to bring convenience for clients’ participation; it will continuously improve relevant systems on iron ore futures, increase the contract continuity, implement the brand delivery system upon study, and intensify the representativeness of iron ore futures price; and it will facilitate the listing of iron ore options and gradually launch more products for the internationalization business upon study.
The FOW (Futures & Options World), founded in 1982, is an international conference organizer specialized in futures and options and subordinated to Euromoney. Various international derivatives conferences held by it every year are influential in the international futures and options field.
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