Taiwan Futures Exchange to Launch Chinese Yuan FX Contracts

TAIFEX has also launched two new ETF Futures on China’s leading stock indices, the FTSE China A50 Index and the

Despite the recent crash of the Chinese equity market, the trend to internationalize the yuan (also known as RMB and CHN) continues. The main derivatives exchange in Taiwan, the Taiwan Futures Exchange (TAIFEX) will launch two RMB FX futures contracts, the USD/CNT FX futures and the USD/CNH FX futures on July 20, 2015.

The USD/CNT and USD/CNH contracts are with contract sizes of USD 20,000 and USD 100,000 respectively. Trading hours for both contracts will be from 8:45am to 4:15pm to cover the trading hours of Taiwanese interbank spot FX market.

In addition, TAIFEX launched two new exchange-traded funds (ETFs) Futures associated with China’s stock indices (FTSE China A50 Index and SZSE 100 Index) on July 8, 2015. They added to TAIFEX’s current ETF Futures offering, and made it a total of six ETF Futures linking to China stock indices.

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Prior to the launch, TAIFEX had already listed futures on several domestic and offshore ETFs, and their total average daily trading volume posted 10,838 contracts in June 2015. The two most actively traded contracts, Fubon SSE 180 ETF Futures and W.I.S.E. Yuanta/P-shares CSI 300 ETF Futures, reached 341% and 78% respectively of their underlying ETFs in terms of traded shares.

TAIFEX’s two newly-added ETF Futures further expand its coverage of offerings over China’s major stock indices, serving investors’ risk management needs on the recent volatile mainland stock market. The venue will enable investors to be more flexible on their trading and hedging strategies, which will then bring up trading volumes in both ETFs’ spot and futures markets.

TAIFEX will extend the trading session of the ETF Futures on China stocks to 4:15pm Taiwan time, which is expected to start from July 20, 2015, in order to cover the entire trading hours of China’s stock market.

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