Category: Money tips Release Date: 2007-04-28
Stock index stock index futures are cash-based transactions, a stock index futures contracts to determine the subject, its constituent stocks of the corresponding set of course, but in order to facilitate the standardization of this contract transactions, the contents of the contract needed to make concrete requirements. Its main contents are outlined below.
1. Contract multiplier
In the stock index futures, its index value is monetized, that is, stock index futures point for each one representative of a certain amount of money, this fixed amount is the "contract multiplier." Of stock index futures contract multiplier for each specified value are different. For example, the Hang Seng Index futures contract multiplier under the 50 dollar per point.
Stock index futures is to use the index points to quoting its price. For example, the Hang Seng Index futures 15,000 points is its price at some point.
2. The contract value and the margin
Multiplied by the stock index futures contract multiplier points, get the contract value.
If we multiplied by the margin percentage to be trading on stock index futures contracts to be occupied by first-hand the amount of margin.
For example, listed in Hong Kong the Hang Seng Index futures contracts, the contract multiplier of 50 Hong Kong dollars, the Hang Seng Index futures and the futures price of the product will get a total value of the contract. If the futures market, reported that out of the Hang Seng Index to 15,000 points, then a contract value of 750,000 Hong Kong dollars. But if the Hang Seng Index rose 100 points, then increased the value of the contract a 5000 Hong Kong dollars.
Similarly, if the futures company provides margin ratio is 10 â„? then, investors trade the Hang Seng Index futures margin is single-handedly 75,000 Hong Kong dollars.
3. Minimum Fluctuation
The smallest changes in stock index futures price is determined by changes in exchange minimum requirements of the stock market, but also to a certain index point to represent. Hong Kong's Hang Seng Index Futures, such as the minimum change in price is an index point, as each index point value of 50 Hong Kong dollars. Thus, a contract (or hand), its smallest change in value of 50 Hong Kong dollars.
4. Daily price fluctuation limit
The vast majority of its listed stock exchange index futures contracts set daily price fluctuation limits, similar to the rise we usually say, daily limit of the system. Each exchange requirements vary, this difference not only in a restricted range, there are also manifested in the limited way.
In a restricted way, there are up, daily limit system and fusing mechanisms, some of exchange only one, and some limit the simultaneous existence of two kinds of exchanges.
Fuse mechanism, is the price control measures within the same day, the exchanges for the control of market risk taken by means of a limit. When the fluctuations of the exchange required to achieve fusing point (that is, when a predetermined margin), Stock Exchange will suspend trading for some time to cool the market for heat. For this "pause", some of exchange is a "melting constantly" approach, namely, "suspension" period can still trade, but limited to the price point within the fuse; some exchange is a "melting and ending" method, namely, "suspension" period can not trade, and business is completely stopped in the fusing point. This "cool off" after a certain time (usually 10 minutes) and then the beginning of normal trading, and re-set the next one fuse point (ie, larger range). Generally allowed only two fused spots, and some using both market and Price Limit.
Fuse mechanism determined in advance, valid within the same day.
5. Settlement
Stock index futures are cash settled, and is implemented according to the law of futures clearing system each day with no debt, that is, investors account the daily performance bond can not be negative.
Each exchange's settlement price of a slightly different pricing, but in general are as follows:
For the daily settlement price is based on the last one-hour trading day volume weighted average price, as the settlement price after the deal closed.
For the expiration date of the settlement price, that is, delivery settlement price is based on the same day the spot market index, sampling every 5 minutes after the arithmetic average price, according to the smallest change in price, after rounding, as the settlement price. Exchange have the right under special circumstances adjustment methodology.
6. Delivery methods
Stock index futures is a cash delivery method.
If the positions of investors at the expiration of the contract has not yet closed that day open interest, then the use of net cash settlement. That is, according to the day of the spot market clearing price index automatically open positions, and then the customer's account Zhaobu unwinding of the net difference.
Behind an instance of this point to explain.
7. Contract Months
Refers to the month of expiration of stock index futures, stock index futures based on the same type of a different expiration month, to distinguish between different contract.
In general, a stock index futures contracts of its "contract month" respectively month, next month and the subsequent two quarters months or up to four contracts.
Each one has a stock index futures contract expires, futures expiration is the spot. In addition, the stock index futures last trading day and the final settlement day is the same day, refer to the last working day of expiration.
