HKEX appoints liquidity providers and market makers for Alibaba futures and options
Stock futures and stock options on Alibaba Group Holding Limited will be introduced on November 26, 2019.
Equity futures contracts on Alibaba will begin trading on Tuesday, November 26, 2019. Hong Kong Futures Exchange Limited announces the following market makers and liquidity providers:
- Market maker: IMC Asia Pacific Limited;
- Liquidity providers: Eclipse Options (HK) Limited and Haitong International Futures Limited.
The position limit for Alibaba stock futures will be 5,000 open contracts per contract month. During the first two weeks after the introduction of Alibaba equity futures contracts (i.e. between November 26, 2019 and December 9, 2019), the market making/liquidity provision obligation in terms of maximum bid/ask spread will be twice the original obligation.
Market makers/LPs are required to provide bid/ask quotes for the first two contract months listed. On the start day, the first two contract months shown will be December 2019 and January 2020.
Equity options on Alibaba will begin trading on Tuesday, November 26, 2019. The Stock Exchange of Hong Kong Limited announces the following market makers:
- Eclipse Options (HK) Limited;
- IMC Asia Pacific Limited;
- I-Access Investors Limited;
- Haitong International Securities Company Limited;
- Optiver Trading Hong Kong Limited;
- Susquehanna Hong Kong Limited;
- Guotai Junan Securities (Hong Kong) Limited.
In order to provide more choice to investors, 12 strikes above and below HK$187.5, the closest maximum offer price (i.e. HK$188) of the underlying stock , will be available for trading on the launch date. New strike prices after the start date will be introduced in accordance with the trading operating procedures for participants in options trading.
The position limit for Alibaba options contracts will be 50,000 open contracts in any market direction for all expiration months combined.
During the first two weeks (i.e. between November 26, 2019 and December 9, 2019), the market making obligations in terms of the maximum bid/ask spread will be twice the initial obligation.
From the start date to November 28, 2019, there will be six contract months available for trading and the spot month contract will be December 2019 (i.e. the last month of the third quarter will not be available) . During this period, market makers are required to select assigned series from the available six expiry months. From November 29, 2019, the number of expiry months available for trading will return to seven.