Singapore Exchange (SGX) has announced its intention to list contracts on the MSCI China Free Index SM. These new SGX MSCI China Free contracts will further broaden the suite of China-linked risk management products available on SGX, with specific relevance to global institutional investors in China equities.
The SGX MSCI China contracts are USD denominated and will track the MSCI China Free Index SM, which comprises large and mid-cap Chinese companies listed outside of mainland China. Index constituents include H-shares, Red chips, P chips as well as ADRs1.
The MSCI China Free Index SM has a broad representation of sectors including financial, information technology and consumer companies. The SGX MSCI China contracts therefore provide an effective and holistic risk management tool for managing exposure to the new industries driving the next stage of China’s economic growth.
Michael Syn, Head of Derivatives at SGX said “The SGX MSCI China contracts are a timely development, as capital formation grows apace for China’s increasingly diverse and modern economy. Global institutional investors and risk managers seeking broader access to China are strongly supportive of SGX’s initiative.”
The SGX MSCI China contracts add to SGX’s China-linked offering that spans equity, FX and iron ore derivatives. In addition to the SGX FTSE China A50 Index Futures, SGX offers one of the most liquid CNH futures markets, which has cleared over USD32 billion since launch in 2014. The contracts will also complement China’s efforts to open up its capital markets and promote two-way accessibility.