HKEX signs licence deal with MSCI to launch Asia, EM futures and options contracts

(Reuters) – Hong Kong Exchanges and Clearing Ltd (0388.HK) said on Wednesday it will launch Asia and Emerging Markets futures and options contracts under a licence deal with global index publisher MSCI (MSCI.N), as the bourse operator expands its product base.

Under the agreement, HKEX unit Hong Kong Futures Exchange will receive a suite of MSCI equity indexes on which it will base an initial 37 futures and options contracts.

This deal “represents another significant development in continuing to build the breadth, depth and attractiveness of Hong Kong’s vibrant financial markets,” HKEX Chief Executive Officer Charles Li said in a statement.

Last year, MSCI and HKEX signed a licence agreement to launch futures contracts on the MSCI China A Index to provide a hedging tool due to rising investor interest in Chinese mainland shares.

MSCI Chief Executive Officer and Chairman Henry Fernandez said the licence agreement for Asia and Emerging Markets was carved out to meet increasing demand from global investors looking to enhance their risk management capabilities.

The indexes offered by MSCI will include the MSCI Emerging Markets Asia, MSCI China Free, MSCI Singapore and MSCI India, among others.

The introduction of the 37 futures and options contracts would remain subject to regulatory approvals and market conditions, HKEX said.

In a separate announcement, Singapore Exchange Ltd (SGXL.SI) said it would reduce its licence agreement with MSCI from February 2021 onwards.

MSCI Singapore futures and options would remain listed while all other MSCI products would expire from the said date, SGX added.

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