Stock Index Futures to Debut in Mid-April

(Caixin Online) China will launch stock index futures in mid-April, a few months after the approval by the State Council last January, a securities regulator said recently.

Based on the progress of preparations, trading in stock index futures will officially start in mid-April, said Shang Fulin, chairman of China Securities Regulatory Commission. Investors are opening accounts with the exchange now, he added.

The introduction of stock index futures is part of the country's capital market development. The CSRC said in January that it will take about three months to complete final preparations for the launch, which include the setting of criteria for qualified investors, entry policies for financial institutions, and the training of securities companies.
      
In September 2006, the China Financial Futures Exchange (CFFEX) was set up with a mission to launch stock index futures. The exchange completed the design of the CSI 300 index contracts, trading rules and technological work. The construction of the exchange is largely complete.

"The number of investors who have opened accounts (with the exchange) is not overwhelming and that is in line with expectations," said Zhu Yuchen, general manager of the CFFEX.

Zhu revealed that the funds, Qualified Foreign Institutional Investors and private equity have been participating in the drafting of trading rules at the exchange.

Meanwhile, a trial for margin lending will be launched in March. "By the end of March, a few securities companies will start the business of margin lending," said an official at the CSRC.

So far, 11 securities companies have applied for the status of qualified broker for margin lending and the list of chosen brokers will be announced soon. If the trial is successful, the scope of the margin-lending program will be expanded, according to the CSRC.