Continuous expansion of futures and options varieties to cover multiple fields such as agriculture and finance
2024-05-28
Recently, the China Securities Regulatory Commission approved the registration of jujube options and glass options on the Zhengzhou Commodity Exchange. Multiple interviewees told Securities Daily reporters that the launch of the two options mentioned above will provide more matching tools for risk management needs of related industry enterprises and further enrich trading strategies. Meanwhile, from the current operation of agricultural product futures and options in China, it is necessary to accelerate the supply of more varieties in the future. The total number of varieties will reach 133. According to data from the China Futures Industry Association, as of the end of April this year, the cumulative number of varieties in China's futures market has reached 131, covering multiple fields such as agriculture, metals, and finance. With the registration of glass options and jujube options, it is expected that the total number of futures and options in the entire market will reach 133. In mid November last year, opinions were solicited on the two options contracts mentioned above. According to the information on the website of Zhengzhou Commodity Exchange, the subject of glass option contracts is glass futures contracts, and the types of contracts include call options and put options; The trading unit is a one hand glass futures contract, with a minimum fluctuation price of 0.5 yuan/ton. The exercise method is American options, which means that the buyer can submit an exercise application at any trading time on any trading day before the expiration date; The buyer may submit an exercise or waiver application before 3:30 pm on the due date. The subject matter of the jujube option contract is a jujube futures contract, with a trading unit of 1 hand dried jujube futures contract and a minimum fluctuation price of 1 yuan/ton; The exercise price covers the settlement price of the underlying futures contract on the previous trading day, with a fluctuation of 1.5 times. When the exercise price is ≤ 10000 yuan/ton, the interval is 100 yuan/ton; When the exercise price is between 10000 yuan/ton and 20000 yuan/ton, the spacing is 200 yuan/ton; The exercise price is greater than 20000 yuan/ton, and the exercise price interval is 400 yuan/ton. In the eyes of market participants, listed jujube options and glass options can form a synergy with existing futures options, providing more diverse, refined, and flexible risk management tools. Wang Junqiang, Chairman of Xinjiang Alar Jutian Red Fruit Industry Co., Ltd., believes that listing jujube options is beneficial for further improving the mechanism of jujube price formation, improving market operation efficiency, optimizing industrial resource allocation, and further enhancing the maturity of the jujube industry. At the same time, it also provides on-site option hedging tools for the "insurance+futures" pilot program of red dates, reducing risk hedging costs, enhancing insurance capabilities, and reducing premium expenses for fruit farmers while ensuring their planting profits, thereby improving the overall efficiency of the "insurance+futures" pilot program. "After the listing of glass options, it can not only reflect the direction of price fluctuations, but also the degree of volatility, helping enterprises make business decisions, better guiding the optimization of glass industry resources allocation, and promoting green building materials products." The relevant person in charge of Wangmei Industrial Group Co., Ltd. stated that this will help further enrich the risk management toolbox of the glass industry, improve the level of industry risk management, and serve the green, low-carbon, and high-quality development of the building materials industry. The supply of new varieties still needs to be accelerated. After years of development, China's over-the-counter derivative instruments have basically met the general needs of the commodity market. However, with the deep expansion of China's futures market services to the real economy, the improvement of matching with the international futures market, and the accelerated formation of differentiated international competitive strategies, the supply speed of new varieties still needs to be further accelerated. Wu Haojun, Secretary of the Party Committee and General Manager of COFCO Futures, told Securities Daily that China's physical enterprises are facing increasingly diverse types of risks, and their demand for the futures market is also becoming increasingly diversified. As of now, the varieties launched in the futures market can largely meet the hedging needs of physical enterprises, but there is still room for improvement in coverage in many fields. As the largest producer and consumer of agricultural products, China still has a significant gap in the variety of agricultural futures compared to the international market. Wu Haojun stated that in order to better align with the international market, China has launched futures products such as corn and sugar, and gradually improved relevant trading and settlement mechanisms. As of the end of 2023, 46 commodity, stock index futures, and options products have been opened for trading by QFII/RQFII overseas traders. However, in the context of globalization, the domestic futures market needs to further enrich its varieties, improve product and rule matching with the international market, meet the needs of international traders, and enhance international influence. In fact, in the process of continuously aligning with the international futures market, China's futures market attaches great importance to the differentiation of product structure, which is also the key to the internationalization development of China's futures market. "In order for China's futures market to stand out in international competition, it must develop varieties with its own characteristics. For example, the listing of characteristic varieties such as red dates, apples, and peanuts greatly meets the unique needs of the domestic market and helps to enhance the resilience of the industrial chain." Wu Haojun believes that in the future, with more futures varieties with Chinese characteristics listed, China's futures market will enhance differentiated competition with the international market and further enhance global influence. (Lai Xin She)
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