HKEX Introduces Closing Auction Session for its Securities Market
- The exchange has successfully launched CAS with a first day with a turnover of $1.1 billion.
Hong Kong Exchanges and Clearing Limited (HKEX) today introduced its Closing Auction Session (CAS) for securities following an extensive preparation and and testing period conducted in conjunction with market participants.
HKEX, which recently announced plans to work on revising its stock option position limit (SOPL) model, designed CAS after consultation with market participants and consideration of the diverse needs and concerns of the various segments of the market.
A total of 290 Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv participants took part and 282 stocks were traded in the CAS on its first day with a turnover of $1.1 billion, contributing to a 2.2 per cent of the full day's turnover.
Closing Auction
The closing auction trading mechanism is commonly used in securities markets across the world to allow Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co at securities' closing prices. During a closing auction, market participants may input buy and sell orders with the price that most volume can be traded at forming the closing price. All orders are then executed at that price.
For CAS securities, the market close is between 4:08 pm and 4:10 pm on a normal trading day whereas for other securities, it is 4:00 pm on a normal trading day.
In parallel, the closing time for the trading of stock index futures and options, currency futures and commodities futures in HKEX's derivatives market has been extended from 4:15 pm to 4:30 pm on a normal trading day, except on the last trading day of the month.
Two-Stage Price Limit
In order to avoid excessive price movements during the CAS, there is a two-stage price limit, initially at ±5 per cent from the reference price and then between the best bid and best ask.
Roger Lee, HKEX's Head of Markets, said: "We consulted the market in January of last year and concluded in July of last year to introduce a CAS based on positive market feedback. With the CAS, we can meet market demand for execution at securities' closing prices, and our approach to the market close is in line with the approaches of other leading exchanges."
Hong Kong Exchanges and Clearing Limited (HKEX) today introduced its Closing Auction Session (CAS) for securities following an extensive preparation and and testing period conducted in conjunction with market participants.
HKEX, which recently announced plans to work on revising its stock option position limit (SOPL) model, designed CAS after consultation with market participants and consideration of the diverse needs and concerns of the various segments of the market.
A total of 290 Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv participants took part and 282 stocks were traded in the CAS on its first day with a turnover of $1.1 billion, contributing to a 2.2 per cent of the full day's turnover.
Closing Auction
The closing auction trading mechanism is commonly used in securities markets across the world to allow Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co at securities' closing prices. During a closing auction, market participants may input buy and sell orders with the price that most volume can be traded at forming the closing price. All orders are then executed at that price.
For CAS securities, the market close is between 4:08 pm and 4:10 pm on a normal trading day whereas for other securities, it is 4:00 pm on a normal trading day.
In parallel, the closing time for the trading of stock index futures and options, currency futures and commodities futures in HKEX's derivatives market has been extended from 4:15 pm to 4:30 pm on a normal trading day, except on the last trading day of the month.
Two-Stage Price Limit
In order to avoid excessive price movements during the CAS, there is a two-stage price limit, initially at ±5 per cent from the reference price and then between the best bid and best ask.
Roger Lee, HKEX's Head of Markets, said: "We consulted the market in January of last year and concluded in July of last year to introduce a CAS based on positive market feedback. With the CAS, we can meet market demand for execution at securities' closing prices, and our approach to the market close is in line with the approaches of other leading exchanges."