Hong Kong Exchanges and Clearing (HKEx) launched new financial products and new trading facilities last year to sharpen further the SAR's competitive edge and reinforce its position as the region's financial centre. These moves were all the more remarkable given the global economic downturn.
"By launching new international products, we hope to attract more international investors to the Hong Kong market," said HKEx's chief executive Kwong Ki-chi.
The year 2001 started off with the launch of the third-generation Automated Order Matching and Execution System (AMS/3), which allowed investors to trade securities over the Internet using mobile phones or personal computers. In mid-year, HKEx then further expanded the range of options for investors with the introduction of two exchange-traded funds (ETFs) listed on the American Stock Exchange. They are the iShares MSCI Taiwan Index Fund and iShares MSCI South Korea Index Fund, based on stock indices compiled by Morgan Stanley Capital International.
The launch of the two ETFs in Hong Kong allows local and international investors to trade funds in the Asian time zone after the US stock market closes, with settlement in US dollars.
HKEx followed up with the launch of the International Stock Futures and Options (ISFO) later in the year comprising 20 international futures contracts and 20 international stock options based on heavyweight stocks listed on stock exchanges in the US, Japan, South Korea and Taiwan.
In November, Hong Kong was selected by Frankfurt-based Eurex, the largest futures exchange in the world, to be its first market for expansion in Asia. Executive board member Peter Reitz said the SAR was chosen as a launch pad to the Asia-Pacific region as "Hong Kong is an important international financial centre for this region." The exchange is also in talks with New York Stock Exchange and another eight exchanges to form a global stock market alliance.
So what has HKEx in store for 2002?
Mr Kwong said HKEx has agreed with other international exchanges to upgrade facilities to shorten settlement times for 2003. The upgrading will start this year. "There has been a worldwide trend to shorten settlement times and Hong Kong needs to follow suit as this will help reduce risks in the market."
HKEx has also announced its soon-to-be-launched remote access trading which allows overseas investors to trade Hong Kong futures products directly. To prepare for this, in November, HKEx signed an agreement with US-based Internet company Radianz and French-based GL Trade (Asia) to allow their clients, usually financial companies, to connect their computers to the futures trading system in Hong Kong.
