Uptick in derivatives turnover predicted

Wednesday, January 13, 2021

Turnover of callable bull/bear contracts and warrants will account for 12 percent of total market turnover in 2021, an investment bank predicts.

Turnover had dropped by 6.5 percentage points year-on-year in 2020.

CBBC and warrants turnover was nearly HK$4.51 trillion last year, a 2.6 percent year-on-year of growth.

Nearly 50,900 new CBBCs and warrants were issued, up 51.5 percent year-on-year, mainly benefiting from the listing of many technology stocks, driving the increase in the number of products.

Horace Chow, vice president of cross-asset listed distribution sales at Societe Generale, said the technology sector will be the focus in 2021.

The bank will issue new products despite US sanctions on Chinese companies, said Keith Chan, managing director, head of Cross Asset Listed Distribution, Asia Pacific.

Goldman Sachs, Morgan Stanley and JPMorgan said they would delist 484 warrants and other derivative products linked to China Telecom, China Mobile and China Unicom stocks in Hong Kong.