A Study on Overseas Derivative Exchanges

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A STUDY ON OVERSEAS

DERIVATIVE EXCHANGES

Prepared by :-

SILVEE KAMBOJ (10DF 006)

PALASH JANA (10DFO14)

SUMITA MONDAL (10DF O23)

SWAROCHIS PANDEY(10DF 032)

MANISH KUMAR (10 DF 041)


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Flow of presentation

Introduction

HONG KONG DERIVATIVE EXCHANGE

JOHANNESBURG STOCK EXCHANGE

AUSTRALIAN SECURITIES EXCHANGE

EUREX

COMPRATIVE ANALYSIS

CONCLUSION


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INTRODUCTION

Derivative exchanges clearly defines the rules and regulations to

control the trade.

Responsible for monitoring trade and market participant

Exchanges ensure smooth trading and also dictate sanctions in the

event that a rule is violated

A growing number of exchanges provide the opportunity of settling

transactions through a central counterparty.

Within the broad spectrum of derivatives, futures exchanges offer

standardized products such as options and futures


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HONG KONGDERIVATIVEEXCHANGE

HSI was started on November 24, 1969, and iscurrently compiled and maintained by Hang SengIndexs Company Limited

Hong Kong Exchanges and Clearing (HKEx) wascreated in 2000 as the holding company for theStock Exchange of Hong Kong, provide anelectronic platform for the trading, settlement and

clearing of securities and derivatives.

Hong Kong Exchanges & Clearing ranked as theworld's 20th-largest derivatives exchange by volumein 2010 with over 116.05 million contracts


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Contd.

The Hong Kong Futures Exchange was established in December1976 as the Hong Kong Commodities Exchange.

Options were added in 1993, with automated trading launched inNovember 1995. The trading floor was closed in 1999.

In 2010, the exchange reported a record volume year for itsderivatives contracts, with 116 million contracts traded, up 17.8percent from the prior year

It's 2010 volumes were driven largely by trading in the Hang SengIndex options, which posted 8.5 million contracts, up 56.6 percentfrom a year earlier

. H-Shares index options totaled 2.9 million contracts in 2010, up48.4 percent, while total stock options rose 28.8 percent to 61.1million contracts.[3]


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Products

A) EQUITY INDEX PRODUCTS

a) Hang Seng Index Futures & Options.

b) H-shares Index Futures & Options

c) Mini-Hang Seng Index Futures & Options

B) INTEREST RATE & FIXED INCOME PRODUCTS

a) HIBOR Futures

b) Three-year Exchange Fund Note (EFN) Futures

c) GOLD FUTURES


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Contract Trading

Session

Trading Hours* Trading Hours on

Last Trading Day(Spot Month

Contract)

Pre Market

Opening Period

Hang Seng Index Futures

Mini-Hang Seng Index

Futures

H-shares Index Futures

Morning

Session

9:15 a.m. - 12:00 noon 9:15 a.m. - 12:00 noon 8:45 a.m. - 9:15 a.m.

Afternoon

Session

1:30 p.m. - 4:15 p.m.

1:00 p.m. - 4:15 p.m.(Effective 5 March

2012)

1:30 p.m. - 4:00 p.m.


2012)

1:00 p.m. - 1:30 p.m.


2012)

Mini H-shares Index

Futures

H-shares Index Options

(Including Flexible Index

Options)

Hang Seng Index Options(Including Flexible Index

Options)

Mini-Hang Seng Index

Options

Morning

Session

9:15 a.m. - 12:00 noon 9:15 a.m. - 12:00 noon Not applicable

AfternoonSession

1:30 p.m. - 4:15 p.m.

1:00 p.m. - 4:15 p.m.

(Effective 5 March

2012)

1:30 p.m. - 4:00 p.m.

1:00 p.m. - 4:00 p.m.

(Effective 5 March

2012)

Not applicable

Stock Futures

Morning

Session

9:30 a.m. - 12:00 noon 9:30 a.m. - 12:00 noon Not applicable

Afternoon

Session

1:30 p.m. - 4:00 p.m.

1:00 p.m. - 4:00 p.m.

(Effective 5 March

2012)

1:30 p.m. - 4:00 p.m.

1:00 p.m. - 4:00 p.m.

(Effective 5 March

2012)

Not applicable

HIBOR Futures

Three-Year Exchange

Fund Note Futures

Morning

Session

8:30 a.m. - 12:00 noon 8:30 a.m. - 11:00 a.m. Not applicable

Afternoon

Session

1:30 p.m. - 5:00 p.m. Not applicable Not applicable

Gold Futures Whole day

Session

8:30 a.m. - 5:00 p.m. 8:30 a.m. - 5:00 p.m. Not applicable


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JOHANNESBURGSTOCK EXCHANGE

(INTERNATIONALDERIVATIVEEXCHANGE)

1963 JSE becomes a member of the World Federation ofExchanges

2001 The JSE acquires SAFEX, the South African FuturesExchange, and becomes the leader in both equities and equity

and agricultural derivatives trading in the South African market.

2002 All listed securities are successfully dematerialised and

migrated to the STRATE electronic settlement environment,

with rolling, contractual and guaranteed settlement for equities

taking place five days after trade (T+5)

2004 The JSE launches the Socially Responsible Investment

(SRI) Index, which measures compliance by companies withtriple bottom line criteria around economic, environmental and

social sustainability


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Contd The JSE Ltd (JSE) is licensed as an exchange under the

Securities Services Act, 2004 and Africas premier exchange

The JSE demutualises and incorporates in South Africa as JSELimited, a public unlisted company on 1 July 2005.

SAFEX Commodity Derivatives Market provides a platform

for price discovery and efficient price risk management for thegrains market in South and Southern Africa

The physically settled commodities rely on warehouse receipts

to facilitate the delivery process. The warehouse receipts areutilized by financial institutions who offer financing to clients

who own the receipt


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Commodity derivative productsa) Gold Futures & Options

b) Copper futures

c) Platinum Futures & Options

Currency Derivatives Market Products

a) Currency Futures

b) Currency Options

c) Maxi Currency Futures Contract

d)RAIN (Rand Index)


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PERIOD TIME

Agricultural Derivatives *Foreign Referenced

Commodities #

Market pre-opening 08h50 to 08h59 08h50 to 08h59

Market opening 09h00 09h00

Market closing 12h00 17h00

Administration

12h00 to 12h45 (physical

delivery month contracts)

12h00 to 14h30 (all other

expiry month contracts)

17h00 to 17h15

Mark-to-Market release 12h45 17h20

Physical delivery auctioning

process

11h30 to 13h00 (random

close in the last 60 seconds)

Physical delivery invoicing 13h00 to 14h30


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Periods Start time End time

Market in download only period 05h00 08h00

Administration period and download only 08h00 09h00

Automated trading period 09h00 17h00

Administration period 17h00 17h30

Market in download only period 17h30 03h00


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AUSTRALIAN SECURITIES

EXCHANGE

ASXwas created by the merger of the Australian StockExchange and the Sydney Futures Exchange

It functions as a market operator, clearing house andpayments system facilitator

ASX operates two trading, clearing and settlementplatforms, one for equity and related equity derivative

products and one for a suite of interest rate, equity indexand commodity futures (and options on futures) products

equity and related equity derivative products traded on anintegrated trading platform between the hours of 10:00am

and 4:00pm


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Contd

Interest rate, equity index and commodityfutures (and options on futures) products aretraded on a globally distributed 24 hourplatform

ASX has a pre-market session from 07:00amto 10:00am AEST and a normal trading

session from 10:00am to 04:00pm AEST. A single-price auction is done between

4:10pm and 4:12pm to set the daily closingprices


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PRODUCTS

Equity Options

Index options

Index Futures

Interest Rate Futures & Options

Grain Futures & Options

Futures & Options

Energy And Environment Products

Agricultural Products


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EUREX

Eurex is one of the world's leading derivatives exchanges and is jointlyoperated by Deutsche Borse AG and SIX Swiss Exchange.

market participants connected from 700 locations worldwide, tradingvolume at Eurex exceeds 15 billion contracts a year

provides an automated and integrated joint Clearing House- EurexClearing AG

Mission

Driven by the spirit of performance, our mission is to be the power

of innovation. We shape liquidity pools globally by settingbenchmarks in market efficiency and integrity.

Vision

Eurex - passionately shaping the derivatives industry. We organizemarkets globally


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PRODUCTS Equity derivatives

Credit derivatives

Interest-rate derivatives

Eurex Bonds and Eurex Repo


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Eurex operates in three trading phases: pre-trading, trading and

post-trading.

The trading day at Eurex typically runs from 07:30 to 22:00 CET.It consists of three phases.


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CLEARINGPROCESS


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ACCOUNTS

There are four general types of accounts:

Position accounts (principal, agent, Market

Maker)

Premium accounts (principal, agent, Market

Maker)

Fee Accounts (principal, agent, Market

Maker)

Cash/securities accounts


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Currency derivative Products

Hang seng Asx Jsx eurex India

Interest

rate

products

1) HIBOR futures

2) Three year

exchange fund

note (EFN)

futures

1) Asutralian stir

futures and

options

2) Australian bonds

futures and

options

3) Australian swaps

futures

4) Australian one

session options

5) NZ STIR futures

and options

1) JSE bond

futures

2) j-Options

3) Jibar Futures

4) Index futures

1) Euro-Schatz

Futures

2) Euro-Bobl

Futures

3) Euro-Bund

Futures

4) Euro-Buxl

Futures

1) 10YGS 7(

UD GOVT.

SECURITIES

,TENNUT

2) 91DTB


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Equity derivative productsPARTICULAR UNDERLYING

ASSET

TENNURE CONTRACT

SIZE/VALUE

CURRENCY

Equity options Top 100 shares For category 1> sixrolling months

For category 2->3

rolling months

100 shares percontract

A$1

Index options AXS approved

indices (S&P/ AXS

200 index)

For category 1> six

rolling months

For category 2->3

rolling months

1000 shares A$1

SAVI 40 South Africa

volatility index

30 days IDX FUTURES ZAR

EQUITY INDEX

FUTURES

JSE TOP 40 INDEX

FUTURES

3 MONTH One index point (r

10 )* index level

ZAR

EURO STOXX 50

INDEX FUTURES

EURO STOCK 50

INDEX

9 MONTHS EUR 10 EURO

FSEN SENSEX

FUTURE

SENSEX

FUTURES (INDIAN

BLUE CHIP INDEX

OF BSE )

6 MONTHS USD 1 USD

INDEX FUTURES 5 INDICES 3 MONTHS DEPEND ON LOT

SIZE OF UNDER

LYING ASSET

Rs

Mini index futures S&PCNX nifty 3 months Lot size 20 Rs


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INTRESTRATE DERIVATIVES PRODUCTS

PARTICULAR UNDERLYING ASSET TENNURE CONTRACT SIZE CURRENCY

One-Month HIBOR

Futures

(

One-Month Hong Kong

Interbank

Offered Rate

ONE MONTH HK$15,000,000 HK$

Three-Month HIBOR

Futures

Three-Month Hong

Kong Interbank Offered

Rate

THREE MONTH HK$5,000,000 HK$

Three-Year Exchange

Fund Note (EFN)

Futures

Three-year notional

Exchange Fund Notes

with a coupon of 6%

THREE YEAR HK$1,000,000 HK$

Euro-Bobl Futures Debt instrument issued

by the Federal Republic

of Germany (coupon

rate 6%)

4.5 to 5.5 years EUR 100,000 EUR

Euro-Schatz Futures Short-term debt

instrument issued bythe Federal Republic of

Germany

1.75 to 2.25 years EUR 100,000 EUR

Euro-Bund Futures notional long-term debt

instrument

8.5 to 10.5 years EUR 100,000 EUR

Euro-Buxl Futures notional long-term debt

instrument issued by

the Federal Republic of

Germany

24 to 35 years EUR 100,000 EUR


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GOLD FUTURES

AND OPTIONS

GOLD 1 MONTHS 1 CONTRACT=10

TROY OUNCE

ZAR( SOUTH

AFRICAN RANDS)

SAVI WHITE MAIZE WHITE MAIZE 3 MONTH 1 CONTRACT=10

TROY OUNCE

ZAR( SOUTH

AFRICAN RANDS)

WAW1U WESTERN

AUSTRALIAN

WHEAT

1 YEAR 20 TONNES A$1

ASM1U AUSTRALIAN

SORGHUM

1 YEAR 20 TONNES A$1

GOLD FUTURES

(HKEx)

GOLD NOT LESS

THEN 995

FINENESS

2 MONTHS 100 TROY ONCES U$ DOLLARS

GOLD 100 GM

FUTURES

GOLD 2 ,3,5 MONTHS 100 GRAM Rs

(WHTSMQBELI)

WHEAT FUTURES

WHEAT 6 MONTHS 10 MT Rs


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INDIA JSE HKEX EUREX ASX

Settlement

period

T+2 T+3 T+2 T+3 T+3


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A Study on Overseas Derivative Exchanges

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