China eases futures trade

Business | Reuters 3 Dec 2018

China's financial futures exchange said yesterday it was further relaxing index futures trading rules, reducing margin requirements, cutting trading fees and allowing more trading activities.

The China Financial Futures Exchange said it was lowering the margin ratio for and SSE50 index futures to 10 percent from 15 percent.

The ratio for small cap index futures would be lowered to 15 percent from 30 percent. The exchange said it was making the moves after having comprehensively evaluated the market risks and actively improving the supervision system. "The adjustments are positive measures to optimize stock futures index trading and promote the effective functioning of the market," it said.

Intraday activity exceeding 50 lots on a single index futures contract would be considered excessive, according to the new guidelines, as opposed to 20 in the past.

The new rules take effect today.

China tightened index futures trading rules during the 2015 crash but has been gradually relaxing rules since early last year. The exchange said it would track the implementation of the measures, strengthen its market risk monitoring and supervision of trading, and ensure that the stock index futures market is "safe and stable."

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