Four Brokerages 47 Billion Enter Stock Index Futures

Stock index futures "regular army" one after another admission.

In May 18th, China Merchants Securities and Huatai Securities announced that two companies intend to apply for proprietary business and entrusted asset management business to participate in stock index futures.

As of May 18th, the board of directors of four securities firms, including China Merchants Securities, Huatai Securities, CITIC Securities and Guang Fa securities, passed the motion of stock index futures trading in their own business and asset management business. According to the relevant data, the upper limit of the four Securities Dealers' self operation involved stock index futures was 47 billion yuan.

As for the participation of asset management business, the director of Huatai Securities secretaries told the reporter: "determine the amount of participation according to the product contract."

However, for the long-awaited stock index futures trading, several brokerages interviewed indicated that they were still in the cautious watch stage, and they only started the stock index futures business with hedging purposes.

Self run 47 billion yuan

"GF Securities has got the hedging code."

In May 18th, the first company to disclose its participation in stock index futures, GF Securities, said that the company had obtained the first batch of hedging codes and corresponding quotas.

In May 4th, GF issued a notice that the board of directors would participate in the motion of stock index futures through proprietary business and asset management business.

GF Securities said that the scale of investment in the stock index futures trading of the company's securities proprietary business should not exceed 80% of the upper limit of the securities companies' risk control index management measures.

According to the regulation on risk control index of securities companies, the total amount of proprietary securities and securities derivatives shall not exceed 100% of net capital.

Guoxin Securities Research Report shows that at the end of 2009, GF Securities net capital was 8 billion yuan, according to the announcement of GF Securities, the company's investment in equity securities and financial derivatives would not exceed 6 billion 400 million yuan.

In May 6th, CITIC Securities said that the board of directors carried out a plan for stock index futures trading through the company, and the Licensing companies management department submitted an application to the regulatory authorities for the relevant formalities.

CITIC Securities said that the investment scale of CITIC stock index futures business (stock index futures business with hedging and other trading purposes) will not exceed 50% of net capital of the company based on contract value.

Guoxin Securities Research Report data show that in 2009 CITIC Securities net capital was 38 billion 800 million yuan, which means that CITIC Securities participation in stock index futures trading business upper limit of 19 billion 400 million yuan.

The investment scale of China Merchants Securities and Huatai Securities to carry out the stock index futures business is limited to the total amount of equity investment and proprietary self investment disclosed in 2010.

China Merchants Securities stipulates that the scale of investment in stock index futures business is determined according to the motion approved by the board of directors on the company's self investment quota in 2010, that is, the total amount of proprietary investment in equity securities and derivatives of the company in 2010 will not exceed 40% of the audited net assets at the end of last year.

According to the 2009 annual report of China Merchants Securities, the net assets of the company belonging to the parent company at the end of 2009 amounted to 22 billion 606 million yuan. In this calculation, the scale of China Merchants Securities participation in stock index futures was 9 billion 42 million yuan.

According to the resolution of Huatai Securities 2009 annual shareholders' meeting, the total amount of proprietary investment of Huatai Securities in 2010 was less than 40% of the net asset scale issued by the company.

According to the quarterly report of Huatai Securities in 2010, the net assets of Huatai Securities amounted to 30 billion 200 million yuan.

Therefore, the upper limit of the participation of Huatai Securities in the stock index futures is 12 billion 80 million yuan.

Statistics above four brokerages, self operated business participation in stock index futures limit has reached as high as 47 billion yuan.

The trading data of CICC show that in recent years, the Shanghai and Shenzhen 300 index futures contracts are active, with an average daily turnover of about 160 thousand hands, with a turnover of about 100 billion yuan. Obviously, the admission of institutional capital will bring a large amount of additional capital to the stock index futures market.

"Almost all brokerages who are self-employed are actively preparing to participate in the stock index futures trading."

A broker from Shenzhen revealed that a more dangerous tool is good for brokers.

Wait-and-see market

The organization is actively preparing for war, but the capital market is still waiting.

Although many agencies are actively preparing to participate in the trading of stock index futures, according to the current market, many brokerages say that it is not easy to make profits through shorting the Shanghai and Shenzhen 300 stock index futures.

"At present, the market is around 2500, and the demand for short selling of stock index futures is not very significant."

A broker dealer in Shanghai has explained that at the current point, the systemic risk of the market has been released, and the demand for hedging is no longer urgent.

Because the current securities company's proprietary business can only participate in stock index futures trading with the purpose of hedging, this means that selling stock index futures contracts becomes the only choice for the proprietary sector holding stocks. Therefore, the higher the index, the greater the risk of downfall, and the higher the enthusiasm of securities companies to participate in stock index futures.

However, in the case of low stock index and systemic risk, it is not necessary for the self operated Department to hedge risk by short selling stock index futures.

In asset management business, Huatai Securities related stakeholders said it would participate in stock index futures under the collective asset management plan contract.

The guidelines issued by the securities and Futures Commission for securities companies participating in stock index futures trading stipulate that "the collective asset management plan established by a securities company has not specifically agreed to participate in stock index futures trading, and in principle, it is not allowed to invest in stock index futures.

If we want to change the contract to invest in stock index futures, we should inform the customer two months before investing in stock index futures.

A broker from Shenzhen revealed that because the change of the asset management plan contract was too cumbersome, the securities companies would not normally apply for the index futures trading code for the old products, but would only participate in the stock index futures in the new products introduced later.

Although it has not yet entered the field, many agencies still affirmed that the securities companies are the main force of the stock index futures institutions in the future. They believe that in the special corporate bodies such as brokerages, public funds and QFII, the securities companies will become the main force of futures trading, because the securities companies' self management and information management business pursues absolutely no gains, and there is a great demand for low risk arbitrage and risk aversion.