SFC's Liang: Extended Trading Hours Paper Due This Quarter; Derivatives First
HK01 · 4 SOURCES1 day ago2 MIN
Summary
The Securities and Futures Commission (SFC) CEO Christina Liang announced at an Asian Securities Industry and Financial Markets Association (ASIFMA) forum that the Hong Kong Stock Exchange will publish a discussion paper in Q4 on extending cash market trading hours, with derivatives market first. The SFC is also collaborating with HKEX on cross-market margin netting arrangements to unlock trapped collateral, while OTC Clear targets same-day bond settlement by year-end to enhance non-cash collateral utility.
Key Points
- Extending trading hours will first target derivatives market to help investors respond to fast-moving global markets across time zones, with HKEX publishing cash market discussion paper in Q4
- Tokenized currency and digital Hong Kong dollar settlement will support extended trading hours, allowing investors to adjust positions and manage risk based on latest market information
- Cross-market margin netting: traders must currently post margin to separate clearing houses; SFC and HKEX studying arrangements to release trapped collateral while controlling risk
- OTC Clear streamlining bond deposit/withdrawal for same-day settlement, targeting end of this year to make non-cash collateral a more attractive financing tool
- T+1 settlement cycle being implemented to reduce risks, improve capital efficiency, and align Hong Kong with major international markets
Why It Matters
These reforms collectively address long-standing inefficiencies in Hong Kong's market infrastructure, potentially unlocking billions in trapped collateral and attracting more international participation. By modernizing settlement and potentially extending trading hours, Hong Kong aims to strengthen its position as a global financial hub competing with other Asian markets.
These reforms collectively address long-standing inefficiencies in Hong Kong's market infrastructure, potentially unlocking billions in trapped collateral and attracting more international participation. By modernizing settlement and potentially extending trading hours, Hong Kong aims to strengthen its position as a global financial hub competing with other Asian markets.